Bitcoin’s credential as a long-term asset isn’t really up for debate. 2021 to date has proved to be a year of multiple ATHs for the world’s largest cryptocurrency. Despite its recent price correction that saw Bitcoin revisit the $52k level, the coin has managed to recover and bounce back in less than a week’s time. This has also added to the overall bullish outlook for the coin as we head into April.
Interestingly, much of Bitcoin’s investor base is continuing to remain in hodl-mode. This is not just an indicator of investor confidence in the long-term prospects of BTC but also signals that the bull-run isn’t quite over. A key demographic within Bitcoin’s ecosystem is its miners. In 2020, after the block reward halving small-medium-sized mining operations were questioning whether or not the BTC ecosystem was sustainable.
Source: CryptoQuant
However with the price surging in the latter months of 2020 and as 2021 kicked-off, miners once again are backing and hodling the coin quite substantially. According to data provided by CryptoQuant miners aren’t selling their BTC and are continuing to hold on to the coin.
As per the Miners’ Position Index, a value above 2 indicates that miners are active participants in the seller’s market. However taking a look at the ratio of BTC leaving miner’s wallets to its 1-year moving average, MPI indicates a low value of -0.32, backing up the argument that in today’s market, miners are behind the strong hodl sentiment.
Despite the recent price correction, Bitcoin’s seller’s market isn’t thriving and most investors are confident that the coin will retake its position close to or above its current ATH in the coming weeks.
This has also led to increased movement of BTC from exchange wallets to cold storage options. Glassnode’s data illustrated this phenomenon as it highlighted that the BTC balance on exchanges just reached a 2-year low of 2,398,947.544 BTC.
Source: Glassnode
In addition to these facts, it was also interesting to see around 12,300 BTC worth over $650 million leave Coinbase Pro wallets according to reports that surfaced yesterday.
In relation to BTC’s 2020 performance, the present price point of around $55k is staggeringly high. However, in 2021-term’s, this is a rather modest price point given the fact that there was significant bullish momentum earlier in the month that enabled the new ATH.
For new traders, this price correction has been an opportune entry point and one can argue that increased buying around $52k led to the recovery we are witnessing at the moment. Given BTC’s prospects of hitting $100k by the end of the year, if one were to go by scarcity models like S2F, then there is ample room for price discovery past its ATH in the near term and the market’s hodlers are well aware of that.
