Bitcoin ETF benefits are undervalued! Andrew Kang: Bitcoin reached 50K in February and a new high in March

Andrew Kang, co-founder of Mechanism, wrote an article highlighting the profound impact of Bitcoin spot ETFs on prices. He believes Bitcoin will reach a new all-time high next month and cited several data points to support his view.

Bitcoin’s annual net buying flow is astonishing

Andrew Kang believes that his multi-country trek experience allows him to perceive global U.S. dollar liquidity and the scale of funds that may flow into Bitcoin and cryptocurrencies. .

He pointed out that the total annual income of individuals in the United States is about 13 trillion U.S. dollars, and the United States accounts for 25% of global GDP. The total annual income of individuals in the world is about 52 trillion U.S. dollars.

Global cryptocurrency holders account for about 10%. Assuming 1% of annual income is invested in Bitcoin, the annual net purchase of Bitcoin is approximately US$52 billion, which is equivalent to a net purchase of US$150 million per day. Buy.

Bitcoin ETFs further drive buying momentum

Andrew Kang emphasized that the above data did not cover the impact of Bitcoin spot ETFs: Everyone seems to have forgotten that before these ETFs were approved, Bitcoin’s The demand has always been there, otherwise how do you think Bitcoin has continued to move higher over the past 10 years?

Therefore, he believes that the calculation of net buying is already very conservative, and the following factors have not been taken into account:

• Crypto investors may invest 1% per year, but True believers may invest more than 50%, so the overall average may be 3-5%.

• The estimation does not include investment from enterprises, macro funds, pension funds, sovereign wealth funds and other funds.

The negative selling pressure is simply not as good as the net buying

Andrew Kang also pointed out MtGox’s creditor claims, the US government’s seizure of Bitcoin, and even mining companies’ mining withdrawals Selling, has been the bearish thesis for many, but the reality is that these selling pressures simply pale in comparison when measured against net buying.

He calculated the potential selling pressure on MtGox and others in the chart below, which is about $17 billion.

And if he calculated that the annual net buying is US$52 billion, plus the buying momentum of Bitcoin ETF, it would be far higher than these negative selling pressures.

Note: Andrew Kang’s calculation does not take into account investors’ profit-taking, and the data is also different from Bitcoin Treasuries.

Bitcoin broke all-time high in March

Andrew Kang emphasized that the benefits of Bitcoin spot ETFs are related to the launch of Bitcoin futures by CME Group and Coinbase IPO The events are incomparable, and net inflows have begun to occur for several consecutive days.

He predicted that Bitcoin would no longer be below $40,000 in the future, but would rise to $50,000-60,000 in February and hit a record high in March.

Andrew Kang concluded by quoting his tweet from October last year, when he called on everyone not to miss the epic rally, and the price of Bitcoin had just exceeded $30,000.

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