Blockware BTC analyst Mitchell Askew claims that Bitcoin will no longer experience 'parabolic' price increases or 'devastating' bear markets, as the Bitcoin ETF permanently reduces volatility and changes market dynamics.
"BTC/USD looks like two completely different assets before and after the ETF," wrote an analyst on Friday. The chart shared by him shows that price volatility sharply decreased after the launch of Bitcoin ETF in the United States in January 2024. The analyst stated:
"The days of parabolic bull markets and devastating bear markets are over. Over the next 10 years, BTC will reach 1 million dollars through continuous oscillations between 'growth' and 'consolidation'. Along the way, it will bore everyone and shake tourists from their positions."
Volatility
After the launch of Bitcoin ETF in the United States, the price trend of Bitcoin shows calmer price fluctuations.
Eric Balchunas, senior ETF analyst at Bloomberg, wrote that the reduction in volatility helps Bitcoin 'attract bigger fish and give it a chance to be adopted as a currency.' The analyst added that the cost of this may be the lack of 'divine candles.'
The impact of Bitcoin ETF on market dynamics is still a topic of discussion among market analysts, as this investment tool further intertwines traditional finance, institutional investors, and the digital asset market.
Bitcoin ETF changes the dynamics of the cryptocurrency market.
Bitcoin ETF isolates capital in traditional investment tools that currently do not have physical redemption and keep funds off-chain.
This capital accumulation may prevent a rotation towards Altcoins, which was the expectation of cryptocurrency investors in previous market cycles.
In July, the net inflow to Bitcoin ETF exceeded 50 billion dollars, although the increase in Bitcoin capital did not translate into increased on-chain activity.
Analysts say that retail investors are turning to Bitcoin ETF and gaining exposure through fund managers or other financial trustees representing them, rather than directly holding BTC.
Demand for paper BTC and products like BlackRock Bitcoin ETF has led the asset management firm to accumulate 3% of the total Bitcoin supply, raising concerns about centralization among some market participants.
