Grayscale’s Managing Director, Michael Sonnenshein, believes that the rally that has taken the bitcoin price north of $19,000 in recent weeks is set to continue.
Speaking with CNBC’s Squawk Box, Sonnenshein says that bitcoin is “just getting started.” BTC may have gained more than 157% this year but he doesn’t think the rally is over just yet.
Pointing to continuing capital inflows into a variety of investment products that Grayscale offers, Sonnenshein suggests this is likely an indicator that the price hasn’t topped.
Grayscale’s Inflows Point to Continued Bitcoin Bullishness
While admitting that predicting the BTC price is “super difficult,” he refutes the idea that bitcoin is looking a “little bit toppy.”
"If our inflows at Grayscale are any indication of the types of investors that are interested in this asset class or the sizes of allocations being made, we're just getting started," says @Grayscale's @Sonnenshein on the price of #bitcoin #btc pic.twitter.com/6d0GUBqgaM
— Squawk Box (@SquawkCNBC) November 30, 2020
When asked whether the Bitcoin or XRP products are receiving the most inflows, Sonnenshein explained that Grayscale is experiencing inflows across all ten products the firm offers.
Along with BTC, Grayscale currently offers investment products in BCH, ETH, ETC, ZEN, LTC, XLM, XRP, and ZEC. The company also provides exposure to the leading digital currencies as part of the Grayscale Digital Large Cap Fund.
The Managing Director claimed that around one-third of Grayscale investors now own more than one product. Such diversification has reportedly increased throughout 2020.
Grayscale Buying More BTC than Miners Can Sell
Grayscale has been buying up huge amounts of bitcoin so far this year. In fact, BeInCrypto reported on Monday that the company had bought more than 7,300 BTC in the last week alone.
BREAKING: Just during the last week, Grayscale bought +7,300 #Bitcoin pic.twitter.com/P8gN7ki9tR
— Crypto Rand (@crypto_rand) November 30, 2020
Miners currently average around 144 blocks per day and receive 6.25 BTC for each one. 6,300 new BTC joined the total circulating supply last week. Grayscale’s purchases are, therefore, taking bitcoin off the market faster than they’re being created.
Grayscale is only of the major whale buyers currently swallowing up supply. Both PayPal and Square are reportedly buying up huge amounts of their own too.
A recent report by Pantera Capital showed that the two payment companies were also taking more bitcoin off the market than miners could produce.
Such large scale buying of BTC seems to be a major driver of the price rally that Sonnenshein believes may continue. With such a shortfall of supply, perhaps some of the more outlandish price predictions of recent weeks may not be as crazy as they sound?
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