Bitcoin News Today: 21Shares Sees Bitcoin Correction Unlikely Amid Strong Demand

21Shares, a prominent player in the cryptocurrency investment space, has expressed a bullish outlook on Bitcoin, suggesting that a prolonged correction in its price is increasingly unlikely. This perspective comes at a time when the cryptocurrency market is experiencing significant legislative attention, with discussions and potential legislative actions that could bolster the cryptocurrency market, including Bitcoin.

According to 21Shares crypto research strategist Matt Mena, the structural imbalance between surging demand and a rapidly vanishing supply base makes a prolonged correction increasingly unlikely. Mena highlighted that the Bitcoin supply held on crypto exchanges and over-the-counter desks continues to stay at an all-time low while demand for the cryptocurrency continues to rise. This imbalance is further exacerbated by the fact that US-listed Bitcoin ETFs have already absorbed several multiples of the BTC that will be mined this year, not including corporate treasury buyers who continue to add quietly in the background.

Bitcoin reached a new all-time high of $122,884, and new buyers entering the Bitcoin market are seen as price-agnostic and are scooping up the cryptocurrency faster than miners can supply it. This indicates a strong demand for Bitcoin, which is further supported by the fact that Bitcoin is trading at $117,804 at the time of publication. Mena also noted that historically, the third quarter of the year has been Bitcoin’s weakest-performing quarter, averaging just a 6.32% return since 2013. However, this cycle is defying that norm, with Bitcoin setting new all-time highs during the most illiquid, seasonally weak part of the year.

Despite the bullish outlook, Mena cautioned that a reversal can’t be ruled out entirely. He flagged two macro risks that could weigh on the crypto market: if Trump’s proposed tariffs end up being more severe than markets currently anticipate, or if Powell signals that rate cuts are further off than expected, we could see risk assets broadly reprice lower, including Bitcoin. However, 21Shares forecasts that an extended price drawdown over the next six months is unlikely. Once summer ends and liquidity returns, 21Shares expects upside momentum to resume.

The optimism from 21Shares is not isolated. The cryptocurrency market has seen various developments that indicate a growing acceptance and integration of digital assets into mainstream finance. For instance, the introduction of Bitcoin Yield ETPs, which automatically convert yields into Bitcoin, is a testament to the innovative financial products being developed to cater to the growing demand for cryptocurrency investments. These products allow investors to increase their Bitcoin holdings without requiring additional capital, thereby providing a more accessible entry point into the cryptocurrency market.

The bullish sentiment is further supported by the long-term trend analysis of Bitcoin. According to the trend and channel analysis, Bitcoin is moving within a large ascending yellow channel, indicating a bullish long-term trend. This analysis suggests that while there may be short-term price fluctuations, the overall trajectory of Bitcoin's price is upward. This perspective aligns with the view that a prolonged correction is unlikely, as the market continues to show resilience and growth potential.

The legislative support and innovative financial products are not the only factors contributing to the bullish outlook. The cryptocurrency market has also seen a surge in interest from institutional investors, who are increasingly recognizing the potential of digital assets as a store of value and a hedge against inflation. This institutional interest is likely to provide a stable foundation for the market, reducing the likelihood of a prolonged correction.

In conclusion, the outlook for Bitcoin remains positive, with a growing consensus that a prolonged correction is increasingly unlikely. This sentiment is supported by legislative developments, innovative financial products, and a bullish long-term trend analysis. As the cryptocurrency market continues to evolve, it is likely that Bitcoin will remain a key player, driven by its growing acceptance and integration into mainstream finance.