Despite bulls facing headwinds, Willy Woo, an on-chain analyst, is bullish on Bitcoin. He cites recent developments around spot, derivatives, and spot Bitcoin exchange-traded funds (ETFs) in a post on X. The analyst shared a post showing the events that would likely drive prices even higher.

“Paper Bitcoin” Dropping Is Bullish For Prices

Woo pointed to the drop in the volume of “paper Bitcoin” entering the market. Simply put, “paper Bitcoin” refers to derivatives. These are primarily futures contracts, allowing traders to speculate on Bitcoin prices without actually buying the underlying asset, in this case, BTC. 

From the Bitcoin price and the inflow rate of “paper Bitcoin,” Woo notes an inverse correlation between the two. For Bitcoin prices to trend higher, there must be a slowdown in “paper Bitcoin.” Looking at the on-chain price chart, this is precisely what’s happening. Accordingly, there is a high chance that prices will continue rallying despite the recent drawdown.

Presently, the Bitcoin upside remains. However, the failure of buyers to push above $69,000 and confirm buyers of early this week is a concern for optimistic buyers. So far, Bitcoin has printed new all-time highs, but there has been no follow-through.

On March 5, a flash crash led to billions in long liquidations, washing out speculators. While prices have slightly recovered, the coin ranges inside the bear candlestick, a net bearish development.<

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Author: Dalmas Ngetich

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