Bitcoin’s price is up 40% year-to-date (YTD) to regain the $23,000 level. However, ongoing concerns about DCG and grayscale, as well as macroeconomic uncertainty, have left many investors doubting the sustainability of recent price increases.
As prices rise, especially after a long and painful bear market in 2022, investors will be motivated to take advantage of current price levels to gain liquidity, as Glassnode argues in its report. may have increased.
A well-known on-chain analytics firm has revealed in its latest research whether it was a bull trap that drove Bitcoin above its last seen price before the FTX collapse, or if indeed a new bull run is on the horizon. I’m here.
What Bitcoin on-chain data suggests
Grassnode Note report The recent price spike in the $21,000-$23,000 region has resulted in the rebirth of some on-chain pricing models that have historically meant “psychological shifts in holder behavior patterns.”
The company looked at investor and delta prices and noted that during the 2018-2019 bear market, prices stayed within the investor-delta price range for a period similar to the current one (78 days). (76 days).
“This suggests that the sustained pain in the darkest stages of both bear markets is comparable,” said Glassnodes.
In addition to the duration component of the bottoming phase, Glassnode also points to the shrinking investor delta price range as an indicator of the severity of market undervaluation. “Considering the current price and the compression value, a similar confirmation signal will be triggered when the market price hits him back $28.3k.”
Regarding the persistence of the current move, the analysis shows that the recent rise was accompanied by a sharp increase in the share of supply in profits, rising from 55% to over 67%.
This 14-day sharp increase is one of the strongest fluctuations in profitability compared to the previous bear market (+10.6% in 2015 and +8.3% in 2019), which is Bit A bullish signal for the coin.
![Bitcoin supply profitability](https://newsbtc.com/wp-content/uploads/2023/01/Bitcoin-supply-profitability.png)
After last year’s capitulation event that drove the majority of investors into losses, the market is now moving into a ‘profit-dominant regime’, with Glassnode reporting ‘encouraging signs of recovery after strong deleveraging pressures in the second half of the year’. It is.” 2022.
However, selling pressure from short-term Bitcoin holders (STH) is less bullish and traditionally a “factor influencing the formation of localized recovery (or correction) pivots.” The recent surge has pushed the metric above 97.5% in profits for the first time since its all-time high in November 2021, significantly increasing the likelihood of selling pressure from STH.
Bitcoin long-term holders (LTH) have risen above the current price of $22,600 after 6.5 months. This means that the average LTH is just above breakeven. In fact, the current trend indicates that the bottom may be at:
Considering the length of time LTH-MVRV traded below 1 and the printed lows, the ongoing bear market looks very similar to 2018-2019 so far.
![Bitcoin long-term holder](https://newsbtc.com/wp-content/uploads/2023/01/Bitcoin-long-Term-Holder.png)
Glassnode also stated that the amount of the coin, which is over six months old, has increased by 301,000 BTC since the beginning of December, proving the strength of HODLing’s convictions.
Meanwhile, miners are using the recent price surge to boost their balance sheets. Miners have spent about 5,600 BTC more than received since January 8th.
In conclusion, the research firm says it is not yet possible to make a final judgment on whether the next bull market is imminent or whether the bull market is headed for a trap.
[H]Rising prices and the attractiveness of gains after a prolonged bear market tend to motivate supply to become liquid again. […] On the contrary, the supply held by long-term holders continues to grow, which can be seen as a signal of strength and belief. […].
At the time of writing, the price of Bitcoin is at $23.085, relatively calm after the recent surge.
![BTC US Dollar](https://newsbtc.com/wp-content/uploads/2023/01/BTCUSD_2023-01-24_09-01-13.png)
Featured images from iStock, charts from Glassnode and TradingView.com