- News related to Bitcoin is showing positive signs as the cryptocurrency manages to stay above critical levels.
- At the time of writing this article, Bitcoin is trading at $28,030. On higher timeframes, the cryptocurrency is recording gains.
- The current state of the Bitcoin market persists, and recent data suggests a potential change in short-term holders.
While the Bitcoin price continues to move within certain ranges, on-chain data reveals that good days are approaching for Bitcoin.
How’s the Current Situation for Bitcoin?
News concerning Bitcoin is showing positive signs as the cryptocurrency manages to stay above critical levels. Although the current trading environment is uncertain due to continued sideways price movement, new data points to potential gains.
At the time of writing this article, Bitcoin is trading at $28,030. On higher timeframes, the cryptocurrency is recording gains. According to COINOTAG data from last week, BTC saw a 4.4% increase.
A report from Bitfinex Alpha indicates that the current supply of Bitcoin on crypto exchanges has been decreasing since May 2023. This measurement places Bitcoin’s price at its lowest level since the start of a new investment cycle, the lowest since 2018.
The report shows that there are approximately 2.03 million BTC on crypto trading platforms. The reduction in BTC supply in the market is considered good news for Bitcoin, as it has the potential to ignite a new bull market. The report states:
“As the bull market started to rise, reserves on exchanges dropped, and crypto prices quickly surged. This suggests that as investors withdraw their Bitcoins from exchanges, the scarcity on the platform could drive up the price.”
Additionally, the report mentions that a minority of long-term investors gave up during this crypto winter. These investors still hold their coins, and their influence on supply and demand dynamics becomes more significant as short-term investors exit the market.
Less Selling Pressure for Bitcoin
The current state of the Bitcoin market persists, and recent data suggests a potential change in short-term holders. The Coin Days Destroyed (CDD) metric, used to measure supply and demand dynamics, indicates that both long-term and short-term holders are “more inclined to hold their Bitcoin assets for a longer period.”
Furthermore, new market dynamics provide signs of early stages of a bull market. The report states:
“12-18 month supply holders are now in a position to take profits on some of their assets. This is normal for early bull markets, but long-term holders’ supply remains dormant, and even mostly short-term holders’ supply purchased at prices below $20,000 or slightly higher at the start of 2023 remains dormant. This demonstrates investor confidence across multiple cohorts (…).”
