Glassnode Analyst Says Bitcoin Bull Run Is The Most Robust

Glassnode Analyst Says Bitcoin Bull Run Is The Most Robust

On-chain intelligence firm, Glassnode, recently analyzed the current bull market run of Bitcoin.

As per its analysis, the company said that this was one of the most robust bull runs in history, with the latest price correction of the crypto token looking like peanuts as compared to previous cycles.

The bottom

In November 2022, after the collapse of the FTX crypto exchange, the largest crypto token in the market had reached a 3-year bottom at $15,500.

However, during its rise towards its all-time high, the price of Bitcoin did not suffer from a drawdown of more than 20%.

Over the weekend, the price of Bitcoin had seen some pullback, but it had still only recorded losses of 8% for the week.

James Check, the lead analyst of Glassnode, said that this marked the most robust BTC bull markets in history, driven by the demand for spot Bitcoin ETFs.

He added that looking at it from an objective viewpoint, it was not just one of the most robust, but also the least volatile uptrends to have been seen until now.

In comparison, there had been a temporary drawdown of more than 30% in the past bull run cycles that had been recorded.

The trends

For instance, in March 2020, what became known as ‘Black Thursday’, there was a more than 60% pullback in the 2018 to 2021 bull market.

It was not until the following year that Bitcoin had seen a market rally of 15X. According to blockchain data, recent months saw long-term holders sell their Bitcoin holdings in droves.

These are entities that had held their tokens for more than 155 days. As the pioneer crypto token approached its previous all-time high, it sold almost 735,000 BTC tokens since December.

Almost 60% of these tokens were sold due to the massive outflows seen in the Grayscale Bitcoin Trust (GBTC) after it was converted into an ETF.

The climb

This year’s rise in the price of Bitcoin has pushed up its MVRV ratio. This refers to how much profit the coin is giving at the time it was last purchased.

At the price of $70,800, the metric had climbed above its mean by one standard deviation, which is a point where investors have the incentive to sell their tokens, thereby triggering brief selloffs in the bull market.

Check said that since Bitcoin’s MVRV had reached such a point, it made perfect sense for it to pause because this is where major corrections happened in the past as well.

Conversely, the ‘realized cap’ of Bitcoin has gone up because older coins have been purchased at higher prices by new investors.

This means that the cost basis of the average investor has increased. This is a sign of fresh and large inflows into Bitcoin, which means that the bull market is not over as yet.

Check said that on-chain data was proving to be quite reliable, as the recent ATH break was similar to the previous ATH breaks.