It took 66 days to move bitcoin from a price of 17,500 NZD to 35,000 NZD and 52 days from 35,000 NZD to 70,000 NZD. The dramatic price increases come on the heels of inflation, institutional demand, and a crypto supply shock.
Asset prices globally have seen a price surge as a result of excessive money printing regimes. The flood of paper into the economy is chasing a finite amount of valuable physical and digital assets, pushing prices up globally. As Michael Saylor points out in this podcast, property prices in South Hamptons have increased by 100% in 12 weeks. In New Zealand property prices are up as much as 25% year on year. With real estate and equity prices at all time highs, investors are looking for assets that have higher returns than inflation.
It takes an asset 10 years to develop a track record before institutional investors will dive in. With bitcoin being the best performing asset globally 10 out of the last 12 years, institutional investors are ready to bet big on the digital transformation of money and value. Last year payment businesses such as PayPal and Square announced that they would start offering support for cryptocurrency transactions and custody. Governments around the world released information on central bank digital currencies, and major social media platforms announced that they would be launching their own pseudo-cryptocurrencies.
"First they ignore you, then they laugh at you, then they fight you, then they join you"
With these announcements giving investors confidence we saw investment companies such as Microstrategies invest $1.5 billion in bitcoin. BlackRock has announced that they are dabbling in bitcoin, while they believe bitcoin could replace gold. In 2021 we are seeing more businesses hold bitcoin in their treasuries and build new utility for crypto. Tesla recently announced a $1.5 billion purchase in bitcoin in January. Companies like Visa and Mastercard are building support in their infrastructure to pay merchants with crypto and buy and sell crypto.
In May 2020 there was a Bitcoin Halving, where the amount of new bitcoin created went from 1,800 BTC to 900 BTC per day. This event happens every 4 years and limits the amount of new bitcoin being created by 50%. With high net worth and institutional businesses buying bitcoin in quantities of $100 million or more at a time, the available supply on exchanges have been dwindling. It is estimated that less than 4 million bitcoin, or 25% of the bitcoin supply is circulating on Exchanges for trading. While the crypto bull market is well under way, we are seeing that institutional and retail interest is just getting started.
Dasset is seeing record numbers of signups and trading, with trading volumes consistently between $0.5 - $3 million per day on our public order books. Our focus over the next month is on platform performance and scalability, so that we can continue providing the best crypto trading platform in the country. We have chat and email support from 9:30am - 11:00pm, Monday - Friday and working on expanding our support team to give you more hours of support. In the meantime, if you want to have a demo or one-on-one with one of our support specialists, please email us at email@example.com to schedule a time. Over the next two months expect to see automated bank deposits, new advanced order types, and portfolio tracking tools!
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