Many investors are worried that the Bitcoin bull market is over. If you are one of them, then don’t worry because Bitcoin on-chain metrics still show that we are far from a bear market. Yes, there is market fear, but that is because of the regulatory uncertainty and the new laws coming in many countries. To really predict a bear market, we need to look at what’s happening on-chain and is it in anyways replicating what happened in 2018 or earlier.
Bitcoin on-chain metrics
A bubble bursts or a bear market happens when long-term investors start taking cues from short-term investors and start to sell. At this point, there is high liquidity, very less buyers or hodlers, and the number of short-term investors is at a peak. But according to the on-chain metrics, the long-term holders are accumulating, and such wallets are on the rise.
Willy Woo, an analyst, said that a fall to $20,000 could be the start of a bear market like 2018, but it is very unlikely to happen. The main reason why Bitcoin has been stuck at the same levels for so long is institutional futures trading. He also added that the market of Bitcoin has changed significantly in the past few years due to the rollout of future markets. And now, the price is correlating with traditional macro assets.
He pointed out an example of how futures are affecting prices. In 2019 and 2020, people were accumulating, but the prices didn’t rise as the future trading communities were mainly affecting the rates.
Staying Bullish?
At the current price point, there is a lot of calculation going on, and even the future market is trading at a 0.5% premium. The on-chain metrics show that long-term holding wallets keep increasing, and Bitcoin’s adoption is similar to the internet in 1997. All this clearly suggests that there is no reason to be bearish at all. So, it is just a matter of when we will reach $100k (& higher) and not a matter of if.
What are your thoughts as Bitcoin on-chain metrics show we aren’t in a bear market yet? And do you think we will reach $200k this cycle? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.
Also Read: Serena Williams invests in the African project Nestcoin to boost adoption.
