Short term social media data suggests that traders aren’t calling for buying the Bitcoin (BTC) dip right now… but the long term picture is much brighter, with separate research showing that 77% of family offices in the U.S. are either looking at, or have invested in crypto.
The BTFD data was compiled from posts mentioning “buy the dip” on social media platforms such as Twitter, Reddit, Discord and Telegram by K J Lanaul and published on the Insights Santiment blog earlier this week. It tells a positive story too, in a roundabout way.
The research indicated that many traders over the past year have called for buying the dip too early on a downward trend, with the price often falling significantly further afterward and failing to recover for months at a time.
“Often the crowd unanimously call the dip/bottom earlier than the actual dip and the real bottoms forms when the crowd least expects which is represented by low to no mentions in Buy The Dip. As of now the mentions are very low.”
For example, during mid-May, last year after the price of BTC started to crash in response to China’s Bitcoin mining ban and Elon Musk-related FUD, roughly 68,000 traders online mentioned buying the dip as BTC dropped to around $44,000. The bottom however, did not materialize until late July when BTC tagged roughly $29,000.
“The pattern that we have recognized is a 3 wave of Buy the Dip mentions during the downtrend each lower than the previous one and after 3 waves the bottom occurs before the market recovers,” Lanaul wrote.
Buy the Dip social volume x BTC price: Insights Santiment
Crypto for the family
While prices fluctuate short term, long term growth in crypto seems inevitable as more high net worth individuals and families back the sector. According to the latest edition of BNY Mellon’s Global Family Office survey, 77% of family offices are either active in crypto, or are looking at investing in the sector in near future.
Family offices are private firms that manage investments on the behalf of high-net-worth individuals or families. BNY Mellon is an investment banking giant that also provides services in the…