On January 20th, Bitfinex published a report highlighting a notable **Bitcoin** resurgence following a dramatic dip to $89,698. This downturn triggered an unprecedented $818 million in forced liquidations, with long positions accounting for $592 million on January 13th. The **average cost basis** for short-term holders was identified at $88,400, which played a pivotal role in stabilizing prices during this volatile period. Historically, short-term holder cost bases have acted as critical **support levels**, and last week’s low closely aligned with this threshold, prompting the subsequent upward movement.
The recent rebound can be attributed to a surge in **spot buying**, indicated by a notable spike in cumulative trading volume, particularly in U.S. exchanges. This surge mimics buying behaviors witnessed during past **MicroStrategy** acquisitions and **ETF** purchases, underscoring a robust institutional appetite for Bitcoin. Nevertheless, analysts caution that the accumulation from last week may require a period of consolidation, potentially leading to short-term corrections before a full-scale recovery recommences. Nevertheless, Bitcoin’s inherent resilience and ongoing demand solidify its position as a strong asset moving forward.