The possibility of Bitcoin entering a new strong bullish cycle may depend on the capital inflows provided by institutional investors to the market. Ki Yong-joo, CEO of on-chain data analysis firm CryptoQuant, said that Bitcoin could experience another parabolic bull market, but with different dynamics than past cycles.
In a post on social media platform According to his example, approximately $2.7 billion of capital injected into the market in 2011 caused the price of Bitcoin to rise by an extraordinary 55,436%. In contrast, despite capital inflows of approximately $697 billion in the current cycle, Bitcoin’s return has remained at 689%.
According to the analyst, this situation makes clear that as Bitcoin’s market capitalization grows, it will require far more capital to drive the price higher than in the past. Therefore, the main driver of the next big bull market is assessed to be massive capital allocation by institutional investors, rather than individual investors.
Ki Yong-joo emphasized that for Bitcoin to achieve long-term success, it needs to be more than just an asset invested in by exchange-traded funds (ETFs). According to him, the recognition of Bitcoin as a strategic asset class in the global macroeconomic system will be one of the most important developments that could open the door to new capital flows.
Stating that this transformation is still in its early stages, CryptoQuant’s CEO expressed that Bitcoin holds potential for growth. Ki Yong-joo added that if Bitcoin can attract more than $1 trillion in new capital based on realized market capitalization, a parabolic bull market reminiscent of past eras is likely.
*This is not investment advice.
