The Unprecedented Strength of Bitcoin’s Bull Market
Bitcoin’s current bull market is setting new records, with the latest price correction appearing minor compared to previous cycles, as highlighted by analysis from on-chain intelligence firm, Glassnode. Following a low of $15,500 after the FTX collapse in November 2022, Bitcoin’s price has experienced no more than a 20% drawdown on its way back to all-time highs (ATH). Even with a recent dip to just under $67,000, Bitcoin remains only 8% down on the week.
Notably, this marks one of the most robust bull markets driven by spot demand in Bitcoin’s history. Glassnode lead analyst James Check expressed this sentiment on Twitter, stating that this uptrend is objectively one of the most stable and least volatile in history. In comparison, previous cycles have witnessed drawdown periods exceeding 30%, with the 2018-to-2021 bull market seeing a significant 60%+ pullback during “Black Thursday” in March 2020 before a subsequent 15X rally over the following year.
Long-Term Holders Shedding Bitcoin
Blockchain data reveals that long-term holders, defined as entities holding their coins for at least 155 days, have been selling their coins as Bitcoin neared its previous ATH. Approximately 735,000 BTC have been relinquished since December, with a substantial portion of these coins originating from outflows from the Grayscale Bitcoin Trust (GBTC).
With a 52% year-to-date increase, this year’s climb has elevated Bitcoin’s MVRV ratio, indicating the profit potential of the average coin based on its last purchase price. At $70,800, the metric has surpassed one standard deviation above its mean, prompting investors to consider cashing out and potentially triggering short-term selloffs.
Bitcoin’s Resilience and Ongoing Bull Market
Conversely, the selloff has led to an increase in Bitcoin’s “realized cap” as older coins are purchased by new investors at higher prices, signaling a rise in the average investor’s cost basis. This influx of capital suggests that the bull market still has room to grow. Check emphasized the reliability of on-chain data, noting that the current ATH break closely resembles previous peaks, indicating ongoing strength in Bitcoin’s market.
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