Bitcoin at $30,000: Examining the curious market conditions before BTC’s rise

• A recent surge in large transactions and active addresses contributed helped BTC’s rise to $30,000.
• The hike could signify a halving cycle change as implied volatility increased.

For the first time in ten months, Bitcoin [BTC] hit and rose above the $30,000 mark. The increase in the king coin’s price has been a significant milestone for the cryptocurrency market, sparking renewed interest and speculation among investors and traders. 

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

However, the recent surge was not without the impact of broader market dynamics and supply and demand factors.

Changing the plunge to spikes

According to Santiment, there were unusual activities going on in the market just before BTC edged above $29,200. A notable part of this input was the way mid-sized active addresses rose from a notable dip in less than an hour.

Source: Santiment

Active addresses indicate the level of investor interaction within a network. In doing this, it measures the number of unique addresses involved in BTC transactions daily. Information from the Santiment platform showed that active addresses around the period on 10 April were down at 24,600. 

But before the end of the same day, the same metric rose as high as 116,000. Over time, prices follow a wide-scale jump in active addresses. Therefore, it can be argued that the predictive metric made a notable contribution to BTC’s hike. 

This price rise means that BTC’s Year-To-Date (YTD) performance has hit 79%, much to the dismay of analysts who opined that it would struggle to replicate the Q1 form. However, New York Digital Investment Group (NYDIG) released a research paper explaining Bitcoin’s model of exempting itself from correlating with other markets.

Source: NYDIG

Cycles, options, and huge transactions

According to the paper, NYDIG noted that halving cycles have returned. It noted that past Bitcoin supply subsidy has been vital to a spike in the price action. The Bitcoin investment management firm noted,

“In the past, bitcoin halving events have been important markers in its cycle price pattern, marking roughly halfway between two cycle highs.”

The research also highlighted some other reasons for the asset performance, including banking crises, Bitcoin’s NFT involvement, and the hashprice rise from its lows.

Meanwhile, in another Santiment insight released on the landmark day, it was observed that the break of the $29,750 resistance was because a number of 2,000 BTC transactions happened almost simultaneously. 

According to the data, there were 11 transactions, eight of which happened at the same time. Interestingly, the remaining three only took a break and were also triggered minutes later. Notably, these transactions were from exchange to non-exchange addresses.

Source: Santiment

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A situation like this implies that the participants were willing to hold long term. Thus, it had a lot to do with the $30,000 break. Moreover, GreeksLive pointed out that a rise in the Implied Volatility (IV) was also instrumental to the price hike.

The IV captures the market view of the changes in an asset price and accounts for daily block trades. At the time of writing, the options trading data provider mentioned that BTC took half of the market share.

Bitcoin broke $30,000 and Ether approached the $2,000, with significant gains in all major term IVs and a large increase in short-term IVs.
Bitcoin block trades accounted for almost half of the day's transactions, while Ether block trades also accounted for over 30% of trades. pic.twitter.com/AQeCQoKus3

— Greeks.live (@GreeksLive) April 11, 2023