First Mover: Bitcoin Plunges Below $55K Amid Weak Institutional Inflows, Profit Taking
 March 15, 2021  Everything you need to make sense of the crypto markets and beyond Sponsored By:  By the CoinDesk Markets Team Edited by Lawrence Lewitinn If you were forwarded this newsletter and would like to receive it, sign up here. Bitcoin (BTC) -6.3% $56,428 Ether (ETH) -4.9% $1,782 (Price data as of Mar. 15 @12:00 UTC) Good morning. Here's what we're writing about:
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MARKET MOVES by OMKAR GODBOLE Bitcoin Plunges Below $55K Amid Weak Institutional Inflows, Profit Taking Bitcoin is losing altitude on Monday amid weak buying pressure from institutional investors.
The crypto market leader fell as low as $54,790.33 Monday morning, having reached a record high of $61,556.59 on Saturday, according to CoinDesk 20 data. At press time, a small bounce to $55,786 was seen.
"The failure to establish a foothold above $60,000 and the decline is likely the result of the flat-to-negative Coinbase premium – a major bellwether for institutional demand," according to Ki Young Ju, CEO of blockchain analytics firm CryptoQuant.
CryptoQuant's Coinbase premium indicator measures the spread between Coinbase's BTC/USD pair and Binance's BTC/USDT pair. A positive spread implies increased demand from high-net-worth investors and institutions, as these entities prefer to trade via regulated exchanges with over-the-counter desks such as Coinbase.
The premium was negative over the weekend when bitcoin broke above $60,000 and remains marginally positive at press time, implying weak institutional demand.  Coinbase premium compared to Binance (CryptoQuant) The spread has been significantly higher previously as prices surged above the major psychological levels of $20,000, $30,000, $40,000, and $50,000. Bitcoin has charted a six-fold rally over the past six months mainly on the back of increased institutional participation
"I think [we'll see bitcoin] short-term bearish or going sideways until there's significant institutional spot inflows in Coinbase," Ki said.
"Whale addresses holding 1,000 or more bitcoin have been selling, this does not mean the bull run is over, it just means that profit taking is happening," according to market analyst Lark Davis.
Meanwhile, Patrick Heusser, head of trading at the Swiss-based Crypto Finance AG, says the latest pullback is healthy, as the breakout above $60,000 was mainly driven by leveraged traders. "The perpetual futures funding rate and futures premium was super stretched," Heusser told CoinDesk.
And Joel Kruger, currency strategist at LMAX Digital, told CoinDesk an overextended market has pulled back on the back of more reports of a possible cryptocurrency ban in India.
Bitcoin may suffer a deeper drawdown in the short-run if the U.S. bond yields continue to rise, destabilizing stock markets. Technical studies such as the weekly chart relative strength index are also warning of a notable price pullback.
However, the broader outlook remains bullish with the likes of Diginex CEO Richard Byworth predicting a rally to $175,000 by the end of 2021.
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TECHNICIAN'S TAKE by DAMANICK DANTES Bitcoin Finding Support at $54K After Failing to Hold Above $60K Bitcoin (BTC) made a new all-time-high this weekend, but the move was short-lived. The uptrend from January continues to slow, which is probably causing some profit taking. Traders will likely defend lower support.  Bitcoin daily chart has lower support around the 50-day volume weighted moving average (Source: TradingView) --Damanick Dantes
BIGGEST MOVERS These are the biggest movers in the CoinDesk 20 over the past 24 hours:
Gainers:
Losers:
The CoinDesk 20 filters from the larger universe of thousands of cryptocurrencies and digital assets to define a core group of 20. These assets constitute roughly 99% of the market by volume at eight of the largest and most trustworthy exchanges.
ICYMI In case you missed it, here is Friday's episode of First Mover:
Beeple on his $69.3 M NFT Sale; Ethereum's Future The digital artist known as "Beeple" discusses the record-smashing $69.3 M sale of his NFT at Christie's; Ethereum Co-Founder Anthony Di Iorio on Ethereum's evolution; and Hunter Merghart of Bitstamp with the latest news from one of the largest and oldest crypto exchanges in the industry.
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