Prominent Bitcoin analyst, David Puell, says there are two things that could cause Bitcoin to top out in the future.
David Puell, an on-chain analyst and the creator of the Puell Multiple, believes two things could cause Bitcoin (BTC) to see a temporary top this cycle.
The analyst pinpointed the US government potentially taxing unrealized gains and the possible approval of a Bitcoin exchange-traded fund (ETF) could cause BTC’s momentum to slow down.
Why would an ETF have a negative impact on the short-term Bitcoin price cycle?
The potential impact of the US government imposing taxes on unrealized gains on the price of Bitcoin is quite clear.
At the end of each taxation cycle, Bitcoin could see a heightened level of selling pressure, pushing its momentum down.
But the prospect of a Bitcoin ETF potentially having a negative effect on the price of Bitcoin is a relatively new concept.
Puell explains that the arbitrage play of taking advantage of the premium of the Grayscale Bitcoin Trust has been a major catalyst for BTC’s recent rally.
Grayscale investment BTC holdings.