minimal – Earlybirds Invest https://earlybirdsinvest.com Latest Crypto News Mon, 21 Apr 2025 20:40:44 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.8 https://i0.wp.com/earlybirdsinvest.com/wp-content/uploads/2024/12/cropped-New-Project-2024-12-17T235703.455.png?fit=32%2C32&ssl=1 minimal – Earlybirds Invest https://earlybirdsinvest.com 32 32 240146708 Strategy Bitcoin purchases show minimal effect on BTC price https://earlybirdsinvest.com/strategy-bitcoin-purchases-show-minimal-effect-on-btc-price/ https://earlybirdsinvest.com/strategy-bitcoin-purchases-show-minimal-effect-on-btc-price/#respond Mon, 21 Apr 2025 20:40:43 +0000 https://earlybirdsinvest.com/strategy-bitcoin-purchases-show-minimal-effect-on-btc-price/

Weekly Bitcoin (BTC) purchases by Strategy have little to no measurable effect on BTC’s market price, according to VanEck’s head of digital assets research Matthew Sigel.

Sigel pointed out that Strategy-related only accounted for 8.4% of average weekly volume, a figure skewed by four weeks where purchases exceeded 20%. 

However, Strategy represented just 3.3% of activity in most weeks, and did not buy BTC in eight of the 27 weeks analyzed.

Analysis of weekly Strategy BTC acquisitions. (Source: VanEck’s Matthew Sigel)

As a result, Sigel reported a 25% correlation coefficient between Strategy’s weekly Bitcoin purchases and BTC’s end-of-week price and a 28% correlation with BTC’s weekly price change. 

Both figures suggest only weak associations that lack predictive or explanatory strength in understanding Bitcoin’s broader price behavior.

Sigel’s analysis also addressed the broader relationship between Bitcoin mining volumes, fund purchases, and secondary market activity. 

Over the past 27 weeks, Bitcoin’s secondary trading volumes have been nearly 20x greater than newly mined Bitcoin volumes. Even after factoring in Strategy’s purchases, secondary market activity remained approximately 17x larger than aggregate new supply.

The findings challenge the assumption that structured Bitcoin acquisition programs have a material influence on short-term price action. 

Instead, Bitcoin’s price appears driven primarily by broader secondary market forces, consistent with asset market behaviors where large, liquid trading venues dilute the impact of isolated supply or demand events.

]]> https://earlybirdsinvest.com/strategy-bitcoin-purchases-show-minimal-effect-on-btc-price/feed/ 0 32091 Strategic Bitcoin Purchase Spree has a minimal impact on prices, says TD Cowen. https://earlybirdsinvest.com/strategic-bitcoin-purchase-spree-has-a-minimal-impact-on-prices-says-td-cowen/ https://earlybirdsinvest.com/strategic-bitcoin-purchase-spree-has-a-minimal-impact-on-prices-says-td-cowen/#respond Mon, 21 Apr 2025 16:17:27 +0000 https://earlybirdsinvest.com/strategic-bitcoin-purchase-spree-has-a-minimal-impact-on-prices-says-td-cowen/

According to a research paper by TD Cowen, despite his footprint as a major corporate holder for Bitcoin (BTC) (BTC), large-scale purchases of cryptocurrency strategies seem to have little effect if they influence its price.

The findings released Monday challenge the theory that is popular among skeptics. A proactive purchase of a strategy will help support the value of Bitcoin, meaning that prices will fall if there is no ongoing demand. But based on the data, the argument holds less weight, analysts said.

Big buyer, but small slices in the market

The strategy recently issued an additional 1.8 million shares based on its Market Offer (ATM) offering, raising an additional $842 million in net revenue. The funds were used to buy 6,556 Bitcoin, increasing Bitcoin yields this quarter by 1% to 12.1%. However, when measured against the broader Bitcoin market, these purchases are merely a bucket reduction.

Strategic Bitcoin purchases typically average just 3.3% of weekly trading volume, according to TD Cowen analysis. Over the past 27 weeks, the company’s total activity reached 8.4% of its volume, but this figure was skewed over a few weeks, with purchases surged by 20% in a short time. In these eight weeks, the strategy didn’t buy any Bitcoin at all.

“Our conclusion is not plausible that for most periods, strategy purchases could have had a lasting and significant impact on Bitcoin prices,” an analyst at TD Cowen wrote.

correlation? Not much.

The analysis further tested the relationship between strategy Bitcoin purchases and market price, finding it to be statistically weak. The correlation coefficient between the strategy’s weekly Bitcoin purchase volume and the end-of-week BTC price was only 25%. Comparing purchases with weekly price changes, the correlation rose slightly to 28%.

Given that correlation coefficients near zero suggest NO or weak correlation, these results indicate that there is little link between strategy behavior and short-term market movements.

How about passing a miner?

Another common criticism is that strategies often buy more bitcoin than they are mined in a given period, meaning that this creates upward price pressure. Technically true, this analysis shows that this argument misunderstands how the Bitcoin market works.

For the past six months, secondary Bitcoin transactions have surpassed mining volumes nearly 20 times. Even if we remove the strategy purchase from the equation, secondary market activity is still over 17 new supplies. In that environment, both the miners and buyers are priced people, not setters.

“As we’ve seen, the purchase represents a very small percentage of the total amount of Bitcoin trading volume. So the idea that it somehow has a profound or pronounced impact on Bitcoin’s price action seems like a disharmony to us,” says TD Cowen.

Not hype, but the value of the building

The impact of strategies on the Bitcoin market may be exaggerated, but the value generated for shareholders is difficult to ignore.

Last week’s purchase created an estimated incremental gain of 5,281 Bitcoins, bringing quarterly profits to nearly $600 million. Since the beginning of 2023, the strategy has increased Bitcoin holdings by 306%, but has only expanded its fully diluted shares by 94%.

The board’s approval for the remaining ATM capacity and larger share permits is $1.533 billion, with the strategy well positioned to continue this strategy.

“We expect the strategy to continue to drive positive BTC yields for the near future. BTC yields could continue to increase prices for Bitcoin, but the dollar value of incremental profits from the strategy’s financial operations could remain very favorable to shareholders,” the analyst wrote.

Disclaimer: Some of this article was generated with the support of AI tools and reviewed by our editorial team to ensure accuracy and compliance with the standards. For more information, see Coindesk’s complete AI policy.

]]> https://earlybirdsinvest.com/strategic-bitcoin-purchase-spree-has-a-minimal-impact-on-prices-says-td-cowen/feed/ 0 32058 USDC navigates global market stress with minimal volatility https://earlybirdsinvest.com/usdc-navigates-global-market-stress-with-minimal-volatility/ https://earlybirdsinvest.com/usdc-navigates-global-market-stress-with-minimal-volatility/#respond Thu, 03 Apr 2025 16:29:01 +0000 https://earlybirdsinvest.com/usdc-navigates-global-market-stress-with-minimal-volatility/

USDC of major financial development centers

Global economic tensions and changing trade policies have created subtle ripples in the Stablecoin market, with USDC experiencing mild volatility while maintaining the dollar peg.

Stablecoin recently navigated a short drop under parity before recovering quickly.

Circle’s IPO submission revealed unprecedented insights into the Stablecoin ecosystem, including an astonishing arrangement in which Coinbase receives half of USDC’s reserve revenue. With a public offer from major banks JPMorgan and Citibank Backing Circle targeting valuations of between $4 million and five billion, the move has boosted institutional confidence in regulated stubcoins despite ongoing trade disputes affecting traditional markets.

As geopolitical tensions escalate, exchanges like Binance report record-breaking Stablecoin deposits, with USDC playing a key role in the derivative trade market.

Stablecoin’s stability has become particularly attractive during recent market volatility, with trading volume peaking during the transition phase as investors seek protection from economic fallouts associated with international trade disputes.

Highlights of USDC Technical Analysis

  • USDC maintained a narrow trading range of 0.000829 (0.083%), with annual volatility of 1.58%.
  • Price Action showed a gradual decline from 1.0006 to subparity levels around March 31st.
  • A clear support zone formed at 0.9999, trading volume peaks during the transition phase.
  • Recent price action shows a modest recovery trend with increasing purchasing pressure.
  • Consistent volume patterns over 50m per hour suggest an updated confidence.
  • Between 09:53-09:57, a brief immersion under parity (0.9999) marked the first subparity trade during the session.
  • The increase in trading volume peaked at 4.1m units at 09:56 during volatility
  • The buyers stepped in decisively to protect the pegs, resulting in a stabilization of about 1.0000.

Disclaimer: This article was generated with AI tools and reviewed by the editorial team to ensure accuracy and compliance with the standards. For more information, see Coindesk’s complete AI policy. This article may contain information from external sources listed below, where applicable.

External References:

  • Cryptopolitan, “Binance draws in record-breaking influx of Stablecoins,” accessed April 3, 2025
  • Cryptonews, “Coinbase will receive 50% of Circle’s USDC reserve revenue, IPO submissions will be accessed on April 3, 2025.”
  • Bitcoin World, “$5 billion valuation backed by Circle IPO Eyes USDC stability,” accessed April 3, 2025
  • Cryptonews, “IPO Stablecoin Publisher Circle File”, accessed April 3, 2025
  • Coin rise, “NYSE List Circle Files amid Surge in Stablecoin Revenues: Details”, accessed April 3, 2025

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