Bitcoin in 2024: Market Anticipation High Ahead of BTC Halving Event
Summary:
Bitcoin's bullish performance is expected to continue in 2024, with the market anticipating the upcoming halving event. Glassnode reports that investors' speculative interest has risen significantly, similar to the 2021 bull run. The demand in spot markets and increased activity on Bitcoin exchanges support the cryptocurrency's year-to-date performance. Despite these positive indicators, the chances of a sustained rally seem low due to potential profit-taking by new investors.
Investors are eagerly anticipating Bitcoin's upcoming halving event, often correlated with a significant increase in the cryptocurrency's price. Speculative interaction in the digital currency market has spiked to levels reminiscent of the 2021 bull market, a factor that could contribute to a sizable price shift, as highlighted in a recent report by analytics firm, Glassnode.
The crypto market is teeming with excitement as Bitcoin (BTC) continues its stellar trajectory in 2024. The premier digital currency has broken new records, reaching unprecedented heights as of March. The introduction of U.S-based spot Bitcoin ETFs on January 11 greatly amplified the volume of BTC spot trading, with March witnessing the apex of daily volumes. This surge has seemed to plunge the market into a state of euphoria, with significant profit booking on the rise.
Bitcoin's bullish stride initiated back in October 2023 has shown no signs of slowing down. A high liquidity and volatility environment has catapulted the market, replicating structures observed during the bull run of 2021. Glassnode attributes Bitcoin's year-to-date performance to the robust demand within spot markets.
A steady increase in trading activity on Bitcoin exchanges has been observed since July 2023, with a current daily average of trading volume amounting to $8.19 billion, dwarfing the peak of the 2021 bull market. Such a surge in spot trade volume and on-chain exchanges substantiates Bitcoin's 2024 price action thus far.
As the date of the Bitcoin supply halving looms, the market basks in an aura of excitement. Bitcoin's realized profit has also reached the 2021 peak value of 1.8%, denoting that over a 7-day period, 1.8% of the market capitalization was booked as profit. Glassnode predicts an influx of new capital into Bitcoin since this profit booking is complemented by matching demand from purchasing parties.
In line with market dynamics, this situation indicates an influx of new investors, as demonstrated by the increasing percentage of wealth held by coins less than 6 months old in the Realized Cap HODL Waves database. The proportion of such coins swelled from 20% on January 1, 2023, to 47% in early 2023. During bull markets, this metric fluctuates between 84% and 95%. As these new investors hold a growing share of capital, their behavior is likely to attract greater scrutiny.
Despite the sustained surge since 2021, possibilities for a prolonged bullish rally seem low. Profit booking is likely to offset any optimistic trends, particularly as Bitcoin trades above its previous 2021 record. There appears to be a balance between holdings by long-term investors and fresh demand, indicating that the 'Euphoria' phase may still be in its early stages. This news does not offer any investment advice or recommendations. It advises readers to undertake thorough research considering the inherently risky nature of investment and trading decisions.
Published At
4/9/2024 9:35:19 PM
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