Bitcoin, the world’s leading cryptocurrency, has been undergoing a consolidation phase under the $35,000 support level. Despite this temporary setback, a significant number of Bitcoin holders remain steadfast in their belief in the digital asset’s potential. Onchain data reveals that a record-breaking 88.5% of Bitcoin has remained unmoved for the past three months. This article delves into the current state of the Bitcoin market, exploring the reasons behind the unwavering optimism of long-term investors and the potential catalysts for the next bullish run.
One insightful metric providing a glimpse into the current Bitcoin cycle is Glassnode’s HODL Waves. HODL Waves categorize Bitcoins based on their age in wallets, transitioning from red to purple as they remain unmoved. Astonishingly, almost 90% of BTC’s total supply has remained idle for the past three months, indicating a strong conviction among holders. The fact that such a significant portion of the #bitcoin supply has not moved highlights the determination of long-term investors to hold onto their coins.
Another metric, this time from IntoTheBlock, aligns with Glassnode’s findings, revealing a growing number of retail traders joining the long-term holder bandwagon. With the prospect of a spot Bitcoin ETF approval by the U.S. Securities and Exchange Commission (SEC), investors are opting to retain their assets. The number of addresses holding Bitcoin for over a year has reached an all-time high of 34 million addresses, as reported by IntoTheBlock. This surge in long-term confidence signifies a shift in how retail traders perceive Bitcoin’s potential and its ability to generate substantial returns.
Several factors have contributed to the increased long-term confidence of Bitcoin investors. One of the most significant catalysts is the anticipation of a spot ETF trading in the United States. The industry eagerly awaits the SEC’s approval of spot Bitcoin ETFs, with the hope that it will ignite the next bullish run for Bitcoin’s price. A top executive at Valkyrie Investments expresses strong belief in the approval of these ETF applications by the end of the month, further fueling market optimism.
However, it is essential to acknowledge that recent market movements cannot be solely attributed to the excitement surrounding spot ETFs. Singapore-based QCP Capital suggests that macro forces, such as the decline in US bond yields, have played a significant role. With low bond yields, investors are compelled to seek higher-yield investments like Bitcoin. These external factors contribute to Bitcoin’s resilience and attractiveness as an alternative investment opportunity.
Bitcoin’s current consolidation phase signifies a period of anticipation. The cryptocurrency market awaits the return of buyers or a catalyst that will spur the next rally. It is worth noting that when Bitcoin’s supply reached 88% for this metric during a consolidation in late 2022, bears dominated the market, causing Bitcoin’s price to dip below $20,000. However, the market is optimistic about the current consolidation, fueled by the resilience, patience, and unwavering faith demonstrated by Bitcoin holders.
As the Bitcoin market continues its consolidation under the $35,000 support level, the majority of holders remain steadfast in their conviction. On-chain data reveals a record-breaking number of unmoved Bitcoins, highlighting the commitment of long-term investors. The prospect of a spot ETF trading and macro forces such as declining bond yields contribute to the overall optimism and resilience of the Bitcoin market. While the future remains uncertain, the unwavering belief of Bitcoin holders paints a promising picture, suggesting that the next rally may not be far off.
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