Bitcoin (BTC) has been experiencing some selling pressure in the last few weeks. This is something that could be related to corporate investors selling a portion of the BTC they purchased in the last months to declare earnings for this quarter. This is according to Konstantin Anissimov, the Executive Director at CEX.IO.
Bitcoin Selling Pressure Continues From Corporate Investors
We have seen how Bitcoin fell from $58,000 to $43,000 in just days in most of the exchanges. This showed a local top for the digital currency. Now, BTC continues to be traded between $45,000 and $51,000.
During a conversation with Konstantin Anissimov, he said that Bitcoin is still the unchallenged pivot for the entire cryptocurrency market. Moreover, he believes that the price performance of the largest digital asset in the world has a huge weight on the general market dynamics.
As he mentioned, one of the factors that could be related to the current dip is related to the falling shares of the electric automaker Tesla. In recent weeks, Tesla lost 28% of its share value after buying Bitcoin. Nevertheless, it is worth taking into consideration that other companies have followed a similar path without purchasing the digital asset.
Indeed, stocks and cryptocurrencies seem to have registered a larger correlation in recent months. This shows the effect of institutional investors in the crypto market. During the last year, a larger number of platforms is now onboarding institutional clients. They work with a different logic compared to retail investors.
About the current situation of the market, Anissimov stated:
“While the foundations of Bitcoin remain strong, the coin is under much pressure to return gains to corporate investors who may need to declare earnings for the quarter. The bearish dives may also stem from the actions of the retail traders to take profit before the big firms pull the rug off their feet.”
As he shows, we might be experiencing some retail investors selling before the institutions decide to pull the rug off their feet. This is something that we should closely follow and understand in order to avoid entering the market at the wrong moment.
Nevertheless, one thing is clear, there are only 21 million BTC in the world. Companies want to allocate part of their funds to this virtual currency. The main question is how far BTC could go and whether the bull market will last much longer.