Supply Constraints, Herd Mentality, And Bitcoin Prices

After hitting record highs above $56,800, weakness in cryptocurrency markets has been undeniable and BTC-USD has encountered losses of more than 25% in just one week.Recent pullbacks from the highs seem to have emboldened crypto bears making the argument that bitcoin is nothing more than the next “flavor of the week.”.These events show that a battle is being fought between the economists and the hedge fund managers that have reversed the bearish stance and started buying bitcoin assets feverishly.As a result, there's an immovable object (historical regulatory tendencies of governments and central banks) facing an unstoppable force (rising adoption of cryptocurrency assets at the institutional level).We think that emerging supply constraints and underlying price momentum are simply too significant to ignore and we expect to see new record highs in BTC-USD as we move into the second half of 2021.