Mike McGlone, Bloomberg Intelligence Commodity Strategist, has taken to Twitter to indicate four causes behind the optimism of Bitcoiners.
Increasing adoption vs. declining supply
Mr. McGlone shared three graphs: the dynamics of Bitcoin's (BTC) average annual price, Bitcoin's Liquid Index (1Q timeframe) and the ratio between the Bitcoin price's 260-day volatility and the same indicator for the S&P index.
#Bitcoin Bull and $50,000 Support vs. $100,000 Resistance in 2022 -— Mike McGlone (@mikemcglone11) November 19, 2021
Bitcoin is approaching 2022 in what we view as simply a bull market. The nascent technology/asset is experiencing increasing adoption vs. declining supply and showing signs of maturation. pic.twitter.com/pyJ5L6l5L0
He added that Bitcoin (BTC) is still experiencing increasing adoption despite being in the nascent stage as both a technology and a digital asset.
Also, he indicated the declining supply as a net positive factor for Bitcoin (BTC) prospects. Bitcoin's emissions are reduced by 50% every two years.
Finally, according to Mr. McGlone, Bitcoin (BTC) is showing obvious signs of maturation. More or less, it is demonstrated by a declining BTC/S&P500 volatility ratio.
Crucial year for the orange coin
As such, Bitcoin (BTC) is approaching 2022 in a clear bull market. The Bloomberg strategist indicated two levels to watch: the support at $50,000 and the resistance at $100,000.
As covered by U.Today previously, the analyst is also optimistic about the mid-term prospects of Ethereum, the second cryptocurrency.
Mr. McGlone attributed the possible Ethereum (ETH) upsurge to $5,000 to increasing demand, declining supply and Ethereum's role in the digital transformation of the finance segment.