Bitcoin [BTC] bulls undeterred by macro mayhem, new report shows

• In its new report, Galaxy found that BTC traders have remained optimistic.
• On-chain data suggests that BTC’s price could rise further if positive conviction remains.

While uncertainty lingers around the Federal Reserve’s rate decisions, on-chain data revealed that optimism subsists in Bitcoin’s [BTC] market, as many expect the king coin’s price to grow further, Galaxy noted in a new report. 

In its latest report titled “Bitcoin Data Shows Bullish Foundation,” digital assets research firm Galaxy found that since the closure of Silicon Valley Bank on 10 March, BTC’s price has risen by over 45%. With many expecting the coin to claim the $30,000 price mark, positive sentiment drives the market.

Read Bitcoin’s [BTC] Price Prediction 2023-2024

BTC holders are having a good time

According to Galaxy, BTC’s correlation with the traditional equities market has dwindled since the bank crisis began. Interestingly, during the same period, its correlation to gold “has increased sharply.”

Largely, this is a positive thing for BTC, as gold is often viewed as a safe-haven asset. An increase in correlation suggests that BTC is also being seen as a store of value or a hedge against economic uncertainty.

Galaxy opined:

“These correlation data show that, at least recently, Bitcoin has indeed performed more like a safe-haven asset than a risk asset.”

Source: Galaxy

While BTC remains a significantly volatile digital asset, its volatility “has been slowly declining over time.” According to data from Glassnode, while the coin’s annualized volatility surged at the break of SVIB’s collapse, it has since been slightly stable.

Source: Glassnode

The increase in the percentage of BTC’s total supply held in profit may be a factor contributing to growing optimism among BTC holders in recent weeks. Galaxy, in its report, found that BTC’s current supply held in profit sat at 75%, the highest since April 2022. 

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A significant portion of supply was acquired in the $15.5-17k and $18-25k range, and the Spent Output Profit Ratio (SOPR) has risen above 1 for the first time, indicating that traders have taken to spending coins they acquired for lower and possibly signaling re-entry into a bull market phase.

Source: Galaxy

Moreso, BTC investors have filled up their bags aggressively in the past few weeks.

According to Galaxy: 

“A large number of addresses have exclusively received Bitcoin – they have never spent. The number of so-called “accumulation addresses” has spiked in the last month.”

Lastly, BTC’s supply on exchanges has declined steadily during the period under review. Galaxy found that BTC balances held in addresses on cryptocurrency exchanges have dropped to their lowest level since March 2018. A decline in exchange reserves is a bullish sign, suggesting that fewer coin sell-offs are taking place.

Source: Galaxy