On-Chain Metrics Suggest Crypto Is Nearing the Bottom of the Bear Market Despite Recent Price Woes

On-Chain Metrics Suggest Crypto Is Nearing the Bottom of the Bear Market Despite Recent Price Woes

According to a research firm, some on-chain metrics indicate that the bear market in cryptocurrencies may have peaked. According to a recent analysis by IntoTheBlock’s head of research, Lucas Outumuro, more than half of Bitcoin (BTC) holders are losing money on their investments, which is a level not seen since March 2020. This percentage peaked at 62% during the 2015 bear market, and it rose to 55% in 2018.

Explains Outumuro: “Having majority ownership of an asset that is up 25,000% since inception could be a sign that the bearish momentum is becoming too strong. In 2015, it took the majority of holders six months to turn a profit, compared to three months in 2018. Bear cycles appear to be getting shorter and shorter, with a smaller proportion of holders losing over time. This trend also favours the likelihood of a bottom approaching potential.

Bitcoin is trading at $16,632 as of this writing. The top-rated crypto asset by market cap is down 1.92% in the last 24 hours.

Outumuro further points out that amid the price problems in the cryptocurrency market, long-term investors have been buying BTC. Since the beginning of this year, addresses that have held the cryptocurrency king for more than a year have added 2.7 million BTC to their Bitcoin holdings. In weak markets, long-term investor demand for bitcoin gradually reaches a bottom, and they frequently start selling to new investors right after new all-time highs, claims the analyst.

Outumuro also notes that more than $3 billion worth of Bitcoin and Ethereum (ETH) left centralized cryptocurrency exchanges this week. Digital assets exiting cryptocurrency exchanges may indicate hoarding or distrust of centralized platforms, according to the on-chain analyst.

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