This week, the price of Bitcoin (BTC) came close to reaching $36,000, but then quickly dropped to $34,250. After a significant 30% increase in the past month, it is not surprising to see a cooldown in the price as traders take profits and market participants evaluate the factors driving the rally.
Despite the temporary pullback, some analysts remain bullish on Bitcoin and anticipate another “gamma squeeze” if the price manages to break through the $36,300 level. Michael Saylor, the CEO of MicroStrategy, is one of the perpetual optimists. His company recently announced the purchase of 155 BTC for $5.3 million in October, bringing their total Bitcoin holdings to 158,400 BTC. Saylor appears unfazed by the recent price volatility.
During an interview with CNBC, Saylor was asked about the upcoming Bitcoin halving. He explained that most of the natural sellers in the market are Bitcoin miners who need to sell their holdings to cover expenses and debt. Currently, this amounts to about a billion dollars per month. However, the halving, which is set to occur in late April, will cut the selling pressure in half.
Saylor highlighted the significance of this reduction in selling pressure, stating that $12 billion of natural selling per year will be converted to $6 billion per year. Additionally, he believes that the introduction of Bitcoin exchange-traded funds (ETFs) will increase demand for the cryptocurrency. This combination of reduced supply and increased demand is seen as an unprecedented opportunity by Saylor and other investors.
While Bitcoin has experienced substantial gains this year, with a 114% increase overall and a 30% increase in the last month, it is important to note that the price is still nearly 50% below its all-time high. Many individuals may still have reservations about investing in Bitcoin due to recent scandals and controversies surrounding the cryptocurrency industry.
When questioned about the negative perception of the industry, Saylor acknowledged that there have been bad actors and unreliable custodians in the space. However, he emphasized the need for “adult supervision” to overcome these challenges and allow the industry to mature.
In terms of the current investing climate, Saylor believes that now is an ideal entry point for the asset, particularly for those with a long-term investment horizon of 12 to 48 months. He envisions a future where banks and responsible custodians manage Bitcoin, and the industry shifts its focus away from speculative tokens to drive significant growth in the market.
It is crucial to note that this article does not provide investment advice or recommendations. Investors should always conduct thorough research and assess their own risk tolerance before making any investment decisions. Bitcoin, like any other investment, carries inherent risks.