Bitcoin: Evaluating the current market conditions in the wake of FUD
- New data suggests that Bitcoin’s bull market could continue.
- Short positions against Bitcoin rise as the MVRV ratio increases.
Bitcoin has undergone substantial price fluctuations in the past few months. This has raised speculations about its future prospects. However, data from CryptoQuant suggests that Bitcoin could now be in a bull market. And this might continue for a while.
Read Bitcoin’s Price Prediction 2023-2024
The bulls take charge
CryptoQuant’s cycle indicator has been on the rise in recent days. This suggested a positive outlook for BTC.
Additionally, short-term Bitcoin holders have started to make a profit, with data from CryptoQuant showing a 7.6% increase in profits over the past few months. This is yet another sign that shows- BTC is entering a bull market.
However, a contrarian view was noted of late. In recent days, Bitcoin’s exchange inflow went up with a significant portion of the surge coming from whales and miners. This has led to the highest levels of inflow seen in 2023.
Meanwhile, at press time, the amount of HODLed BTC reached a 5-year high of 7.6 billion BTC. The activity on the network started to surge as well, mainly due to the success of inscriptions and ordinals. Consequently, the overall fees collected on the Bitcoin network started to rise.
📈 #Bitcoin $BTC Total Fees Paid (7d MA) just reached a 15-month high of $37,618.98
Previous 15-month high of $37,519.27 was observed on 21 March 2023
View metric: pic.twitter.com/cDOOV29dOo
— glassnode alerts (@glassnodealerts) March 23, 2023
As the interest in BTC and its network starts to rise, so does the MVRV ratio. The rising MVRV ratio of Bitcoin suggested that the majority of the Bitcoin holders are now incentivized to sell their holdings as they are reaching a profitability mark.
Interestingly, the rising MVRV ratio could be one of the reasons why many traders have started to take short positions against BTC.
According to coinglass’ data, the percentage of short positions taken against BTC on the Binance platform increased from 30% to 53.7% over the last few weeks.
This sudden spike in short positions could mean that many traders have started to become skeptical of Bitcoin’s growth.
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