Matrixport Reveals The Investor Demographic That Is Driving The Bitcoin Rally

Bitcoin rallied tremendously last week coming off the back of the devastating new of the Silicon Valley Bank collapse, among others. This saw the digital asset rise to a nine-month high above $28,000 before correcting back downward. In its latest report, Matrixport reveals the investor demographic that drove the price rally.

Americans Are Driving The Bitcoin Price

In a new report, Head of Research at Matrixport Markus Thielen, reveals that US investors are actually behind the wild rally Bitcoin saw since the start of the year. The researcher notes that while the digital asset is up around 66% on a year-to-date basis, the vast majority of these gains occurred during US hours.

To put this in perspective, BTC rallied 47% during US trading hours compared to only 16% that took place during Asian hours, and only 3% during EU trading hours. This means that US investors accounted for 71% of the total Bitcoin growth over the past year.

Zooming out the picture to a two-week basis, Americans once again outperformed their counterparts across the pond. In the last 11 days, the price of the digital asset rose by over 44% and one more, Bitcoin rose over 31% during US trading hours, leaving around 13% for the rest of the markets.

US investors driving BTC price rally | Source: Matrixport

The rise in participation from American investors comes at a time when banks in the country are becoming increasingly unstable. As expected, investors have flocked to Bitcoin as a way to protect their wealth while hedging against any possible impacts the bank crisis may have on the economy.

Can BTC Continue Its Rise?

Presently, the price of Bitcoin has corrected downwards, bringing it back into the $27,000 level. But this does not spell the end of the rally. Rather, it shows that investors are waiting for the FOMC announcement expected on Wednesday.

Matrixport forecasts that the Fed is finally releasing its grip and slowing down its hiking given that the last two meetings have seen interest rates go from 75 basis points (bps) to 50bps and then to 25bps. So expectations are that Powell will likely stick to another 25bps hike.

BTC reclaims $28,000 once more | Source: BTCUSD on TradingView.com

Doing this would be very bullish for digital assets such as Bitcoin and will likely result in further upward momentum for them. Furthermore, inflation is also easing and the Fed is already injecting new liquidity back into the market, giving investors more wiggle room to take risks.

“The new liquidity that the Fed is providing through various forms will not find its way into the real economy and therefore inflation will not rise,” the Matrixport report reads. “We are back to the good old days of (selective) asset rallies. Bitcoin is your best friend in this environment.”

In a previous report, Matrixport adjusted its price prediction for BTC. It expects the cryptocurrency to reach a price of $36,000 in the summer of 2023 while maintaining a year-end price target of $45,000 for Bitcoin.