Bitcoin beer (BTC) disappeared at the last minute as 2021 ends – and a consensus is forming around China, which again causes weakness.
BTC/USD 1-hour candlestick chart (Bitstamp). Source: TradingView
China’s ‘final weapon’ may now be optimistic about BTC
According to data from Cointelegraph Markets Pro and TradingView, BTC/USD dropped from $2,000 to $45,630 hours before the annual close, before Bitstamp slumped below a modest recovery of $47,200 by 2021.
However, under some and many well-known schemes such as Anti-Climax, the lack of a parabolic advantage for Bitcoin is refreshing due to the transition to exchanges.
Chinese consumers had until December 31 to count the major Chinese exchanges they had to cancel, after years when the government tightened the field around crypto trading.
For Bobby Lee, ex-CEO and CEO of BTCC Exchange, this is the “last weapon” in Beijing’s arms and one that could have a profound impact on selling behavior.
“Probably because the much anticipated end-of-year market hasn’t even started yet,” he said in a series of tweets on the subject in early December.
“We are waiting for the final hammer to fall on China! We expect a minor correction when law enforcement steps in, followed by a relief rally that could turn us back for the true Bitcoin bull market.”
While others have voiced their support for the theory, Blockstream also acknowledged this week the potential pressure from Chinese download users who could sell their BTC to withdraw capital amid rising balances.
This is also a hopeful reason for the future, as China’s trade overload will be gone by the end of this month.
“I understand that probably explains why Bitcoin is trading weaker than the US and Europe during Asian hours,” Blockstream analyst Jesse Knutson said in the company’s latest weekly newsletter.
“This is also a potential reason for optimism in the future, as the oversupply of Chinese stock markets will end by the end of this month.”
Bitcoin BTC balance sheet Source: Coinglass
When it comes to holiday cheer
Reducing holidays for a short period of time, such as on Fridays, could be another reason for the drop in prices.
Related: First Bitcoin ETF In The United States Is A ‘Breach’ In 2021 As GBTC Gap Reaches Closing Record
Before Wall Street and institutional investors turn around, the BTC pricing process can often give a vague impression of how the market will perform in the future.
One forecaster this week said that 2022 should see a significant “turn” in holding Bitcoin far beyond retail in favor of high-volume institutional investors.