Inflation is still sky high, but bitcoin (BTC) price is doing the exact opposite of what many of us had hoped for in this situation. The price of the largest cryptocurrency has already fallen by about 70% since November of last year. So you don’t only save money on inflation, but also on cryoto. However, it looks like this could continue for a while.

Bitcoin deposits on exchanges

The well-known crypto analyst Maartunn reports that no less than 90% of all bitcoins that have been deposited on exchanges lately come from whales† That may indicate even more short-term selling pressure† The BTC price has already risen by more than 10% since the bottom, but these whales may fear more drops soon. Although the analysis focuses on the short term, the situation can of course change quickly.

Yesterday, Crypto Insiders reported on the largest ever BTC outflow in a single day. ‘King Stock Capital Management’ reports that a whopping 33,250 BTC has been pouring out of funds recently. This mainly concerns the Canadian Purpose Bitcoin ETF and the 3iQ CoinShares ETF. According to data from CryptoQuant, there are about 700,000 BTC left.

Bitcoin hedge against money printing?

Analyst Jan Wüstenfeld has a good theory about why the bitcoin price is falling. According to the analyst, bitcoin is a hedge against inflation of the money supply, but not a hedge against consumer product inflation. He pays for thatchange of bitcoin versus the shifts in the money supply (M2).

You can clearly see that the correlation between the two is very, very high. Once the Federal Reserve began easing money during the pandemic, bitcoin bottomed out. And as soon as the Fed started raising interest rates, bitcoin hit its peak.

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