December 3, 2020

Cryptheory

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Four indications that retail investors are returning to the cryptosphere

2 min read
Four indications that retail investors are returning to the cryptosphere

It is no secret that the rapid increase in Bitcoin’s value in 2016-2017 could be largely attributed to the interest of small investors. Nor can there be any doubt that when Bitcoin fell in early 2018, retail investors were among the first to leave the market. This drop halted to only 20% of the original price – $ 3,150 / BTC.

 

But as time passed, the situation changed again. Here are four main reasons why belief in long-term strengthening may be appropriate.

 

Reason One: Everyone is buying the Grayscale Bitcoin Trust

 

Not all stocks are traded on the stock exchange, and although the Grayscale Bitcoin Trust (GBTC) is one of those we find on stock exchanges, it is also the second most actively traded stock in the United States outside the stock exchanges.

 

Institutional investors have traditionally dominated these trades, but recently there have been clear signs of the presence of smaller investors returning to the game and giving a second chance to cryptocurrencies.

 

Reason Two: Increased volume traded on Coinbase

 

Larry Cermak, a researcher in the area, released data showing that the average volume traded on Coinbase daily was $ 342.46 million on average in February. That is almost three times the amount of January and about as much as in May 2019. Coinbase is the platform where small investors very often resort to investing. This further supports the assumption of the emerging bull market.

 

Reason three: Google trends data

 

Google trends data that maps search trends suggests that there is a growing interest in everything related to the cryptoworld and cryptocurrencies, including investments in various digital assets.

 

A simple example: the “Buy Bitcoin” search command has just reached its highest frequency in the last 7 months. Here we find an interesting parallel to the year 2017, when small investors (seeking investment opportunities in this way) with similar behavior predicted Bitcoin’s rise to the later $ 20,000. This time, terms like “Etherneum” or “altcoin” appear in search.

 

Reason Four: Media

 

Although this point can be perceived in many ways, there is no denying that we have recently seen a steep rise in references and articles in the media, which are about Bitcoin and the cryptosphere in general. Because the media is known for publishing what the readers want to read, there is no denying certain increased public interest in Bitcoin.

 

Summary

 

Small investors are returning to the cryptosphere. In 2018, we witnessed their outflow, but the situation has changed considerably since then. It may also be due to other factors, such as the general euphoria that resonates in our society these days. Or is it the result of better information and easier access to the world of cryptocurrencies? It does not matter in the end, because the trend is quite clear. What triggered a steep rise in prices before 2018 returns to some extent.

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