Bitcoin is hovering around $18,000 as of November 19, 2020, and the comparisons to the legendary 2017 bull run are inevitable. Back then, Bitcoin topped out at just under $20,000 before crashing spectacularly. But according to blockchain analytics firm Chainalysis, this rally has a completely different DNA — and it comes down to who is buying.
TL;DR
- Bitcoin trading at approximately $17,817, approaching the 2017 all-time high
- 77% of all mined Bitcoin is held in illiquid “investor” wallets, leaving only 3.4 million BTC available for trading
- Trade intensity on exchanges is 38% above the 180-day average
- Institutional players like Paul Tudor Jones and Square are leading the charge — not retail speculators
- Kraken reports $176 million in spot volume and $333.4 million in futures, 50% above its 30-day average
The Supply Squeeze No One Is Talking About
The fundamental driver behind Bitcoin’s November 2020 surge is a classic supply-demand imbalance. Chainalysis tracks Bitcoin held in wallets that send less than 25% of what they’ve ever received — classifying it as “illiquid” or investor-held Bitcoin. As of November 19, a staggering 77% of the 14.8 million Bitcoin that isn’t considered lost is locked away in these illiquid wallets.
That leaves just 3.4 million Bitcoin readily available to buyers who want in. Meanwhile, demand metrics are flashing green across the board. Trade intensity — which measures how many times each Bitcoin deposited on a spot exchange gets traded before being withdrawn — currently sits 38% above the 180-day average. In plain terms: more people are chasing fewer coins.
Institutional Money Changes Everything
The single biggest difference between 2020 and 2017 is the profile of the buyer. In 2017, the rally was powered largely by individual retail investors, many of whom were new to cryptocurrency and driven by FOMO. Fast forward to 2020, and the narrative has shifted dramatically.
Legendary hedge fund manager Paul Tudor Jones publicly compared buying Bitcoin to investing early in Apple or Google — high praise from someone managing billions. Payments company Square invested $50 million in Bitcoin as part of its corporate treasury strategy. These aren’t retail punters hoping for a quick flip. They’re sophisticated investors treating Bitcoin as a legitimate store of value and hedge against monetary debasement.
The Kraken exchange’s daily market report for November 19 underscores this institutional momentum. Total spot trading volume reached $176 million, while futures notional hit $333.4 million — roughly 50% higher than its 30-day average. This isn’t the kind of volume generated by casual hobby traders.
Ethereum Takes a Breather While Altcoins Stir
While Bitcoin held steady at $17,835 (up 0.12% on the day according to Kraken), Ethereum actually dipped 1.7% to $471.96. The divergence suggests that capital is flowing primarily into Bitcoin rather than rotating across the broader crypto market. Litecoin, however, had a standout session, surging 11% to $81.63 and ranking as the fourth most traded asset on Kraken behind Bitcoin, Ethereum, and Tether.
DeFi tokens showed mixed but notable activity. Yearn.finance (YFI) gained 8.7% to $27,776, while Uniswap’s UNI token climbed 7.6% to $3.73. The total value locked in DeFi protocols reached approximately $12 billion in November 2020, signaling that decentralized finance continues to attract significant capital even as Bitcoin dominates headlines.
Why This Matters
The 2020 Bitcoin rally isn’t built on hype — it’s built on fundamentals. Institutional adoption, a shrinking liquid supply, and unprecedented monetary stimulus from central banks worldwide have created a perfect storm for Bitcoin’s price appreciation. Unlike 2017, where the rally was fragile and retail-driven, this cycle has the backing of some of Wall Street’s most respected names.
However, history offers a cautionary tale. As noted in market analysis from November 19, Bitcoin’s previous bull markets experienced multiple corrections of 30-40% even during sustained uptrends. Volatility is the price of admission in crypto, and investors should expect significant pullbacks even if the overall trajectory remains bullish.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always do your own research before making investment decisions.
as someone who got rekt in 2017 the 2020 rally felt completely different institutional money was driving it not retail fomo
microstrategy and square buying btc on the balance sheet changed the narrative completely from 2017 speculation
everyone said 18k was the top and then btc went to 69k the fundamentals were completely different in 2020
2017 was ico mania and retail euphoria 2020 was paypal grayscale and wall street embracing crypto night and day difference
the 2017 vs 2020 comparison was so overdone at the time but looking back the data clearly supported the fundamental difference thesis