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This year, Tax Day – the day individual income tax returns are due to be submitted to the federal government in the US – falls on 18 April.
In 2020, Tax Day was on 15 July, and in 2021 it was on 17 May.
April has been a choppy month so far for bitcoin and crypto in general – could we be seeing the same ‘Tax Day effect’ play out? Tax Day is on 18 April this year, and prices have been selling off throughout April so far.
Net 12,000 and 37,000 coins left exchanges over the past seven and 14 days, respectively .
Longer term, the 30-day change in the exchange balance reveals fluctuations in the supply held on exchanges month on month.
However, they have returned to negative territory, which suggests leveraged traders are paying a premium to keep open short positions.
We experienced some older hands distributing their coins into market strength as prices were rising.
Consequently, if the trust trades at a premium to BTC prices, it may imply ‘excess’ demand from institutions, but ‘excess’ supply if it trades at a discount.
Conversely, holding it in liquid form would suggest investors are bearish, as they prefer being able to sell easily.
Exchanges set funding rates to prevent a lasting divergence in the price of the futures contract and the underlying since perpetual contracts have no expiry date so never settle in the traditional sense.
We can categorise HODLers by the length of time they have held BTC.
The reluctance of investors to sell and realise a profit may be because they believe the price will increase further, which would be bullish.
A measure of the complexity of the problems and so the computing performance required to solve them is the hash rate.