While long-term investors appear unaffected by the surge, the rally sets the foundation for a ‘resumption of the 2023 uptrend,’ analysts say
Bitcoin (BTC) volatility explosion on Oct. 24 has set the market ready for a new rally as a “meaningful proportion of supply and investors now find themselves above the average break-even price,” Glassnode says.
In a research report on Oct. 24, analysts at the blockchain analytics firm noted that over 80% of Bitcoin supply is now in profit as the market is approaching year-to-date highs.
However, long-term holders (LTH) seem unaffected by this week’s rally as almost 30% of their supply is “held at a loss,” analysts say.
The current state of affairs for Bitcoin holders is similar to late 2015 and early 2019 and the March 2020 bottom, suggesting that the current cohort “may well be a more hardened and firm-handed” compared to prior cycles, Glassnode added.
“A meaningful proportion of supply and investors now find themselves above the average break-even price, located around $28k. This sets the foundation for a resumption of the 2023 uptrend.”
Glassnode
In the meantime, analysts at Bitfinex say that on-chain metrics, such as the Spent Output Age Bands (SOAB), indicate further support for sustained volatility for Bitcoin in the coming months. As Bitcoin rapidly surpassed the $34,000 mark, the crypto market is now more dependent on major news narratives than ever before, analysts say.
Bitcoin has reached new yearly highs shortly after reports surfaced that BlackRock’s iShares Bitcoin Trust has been listed on the Depository Trust and Clearing Corporation (DTCC) amid staunch demand for an exchange-traded fund within the crypto industry and broader financial markets.
