Willy Woo, an on-chain Bitcoin (BTC) analyst, is sounding the bullish alarm, citing strong demand and dwindling supply as reasons for optimism. Taking to X, Woo noted that Bitcoin soaks in an average of $607 million daily as an asset in new investor demand. In comparison, only $46 million of new supply is being created through mining.
Bitcoin Receives Over $607 Million In Value Everyday, What Happens After Halving?
The Bitcoin network is a proof-of-work platform reliant on miners for security and decentralization, rendering its transactions censorship-resistant and global. Though there are concerns about centralization, it appears that the broad network of miners holds more importance for the platform, explaining its colossal valuation.
Miners are rewarded with 6.25 BTC after every block, equating to around $46 million, after every 24-hour cycle. However, the fiat value, as expected, changes depending on spot rates.
Woo says the expanding demand, estimated to be about $607 million per day, considers changes in the realized cap. It is a metric that shows the total amount investors have paid for the current circulating BTC. The total value takes into account the price when each was bought.
While useful, Woo notes that the realized cap, and thus, the level of demand injected into Bitcoin, is conservative. The weakness stems from the realized cap only capturing on-chain transactions.
It is this shift in imbalance, Woo pins on, that may propel prices even higher in the coming sessions. The on-chain analyst sees the current trend accelerating further ahead of the next Bitcoin halving set for early April 2024.
Bitcoin halving occurs approximately every four years, reducing the new BTC created per block by 50%. The on-chain analyst thinks this decrease in supply, coupled with the already strong demand, will push prices higher, rapidly increasing the realized cap.
Reddit Plans To Go Public, Buying BTC And ETH
Woo’s optimism follows encouraging news that Reddit, the popular social media platform, will invest some excess cash into Bitcoin and Ethereum (ETH). Recent reports reveal that Reddit plans to go public, filing for an initial public offering (IPO) this week.
The endorsement of crypto by a major technology company showcases the growing institutional adoption, a net positive for investor confidence. So far, Reddit’s IPO prospectus shows that its revenue expanded 20% in 2023.
The platform also boasts over 70 million daily active users. Based on this, once it goes public, it is likely that a significant portion of funds will be injected into BTC and ETH.
Feature image from Canva, chart from TradingView