These 3 key indicators will determine the development of BTC in the next few months

Source: Blockchain Knights

JAN3’s CEO Samson Mow has identified a series of key indicators that could influence BTC’s trajectory in the coming months.

Among many indicators, Mow lists how capital flows to BTC through spot ETF issuers, actual inflation, computing power evolution, etc.

On January 28, Mow said on play a key role.

The CEO specifically emphasized the importance of the spot BTC ETF inflow indicator. The SEC (U.S. Securities and Exchange Commission) recently approved several spot BTC ETFs, the first time in more than a decade.

Some of Wall Street’s top firms, including BlackRock and Fidelity, have been leading the way, buying more BTC in the past three weeks.

As of January 26, 8 spot BTC ETFs bought 4,160 BTC. Meanwhile, Grayscale Investments, the issuer of GBTC shares, sold 9,932 BTC.

As more institutional investors invest in BTC through regulated ETFs, its price is likely to rise.

For now, though, traders are watching how quickly Grayscale Investments is selling off GBTC shares, withdrawing BTC and even allocating it to issuers of spot BTC ETFs.

The conversion of GBTC to BTC may affect the price, causing greater selling pressure and extinguishing the general optimism of holders.

Before the BTC halving event in early April 2024, Mow was still paying attention to the network’s computing power. Computing power measures the computing power delivered to the network to ensure the security of the blockchain.

Generally, the higher the index, the healthier the industrial ecosystem is. At the same time, this will also boost investor confidence, showing that miners are still optimistic about the future of the network despite expecting a significant drop in revenue over the next three months.

As of January 29, the BTC computing power exceeds 559EH/s, which is slightly lower than the historical high of approximately 632EH/s set in January 2024.

Even so, despite rising hashrate, miners have been dumping their assets, selling at spot prices. Over the past week, miners sold thousands of BTC, fueling the downward trend.

It remains to be seen whether this reckoning will continue in the coming weeks. Typically, the more assets a miner offloads through major exchanges, the depressed the price becomes, affecting market sentiment.

In addition to this, the CEO also tracks macro indicators such as the M3 money supply in the United States, the speed of BTC adoption in various countries, and the actual inflation rate of the world's major economic powers.

In the United States, the money supply and real inflation declined modestly due to relatively high interest rates.

However, this could change if the Fed lowers interest rates in the coming months.