- Bitcoin has risen impressively in the past seven days, bringing it back to levels last seen in June 2022.
- Concerns about liquidity due to banking collapses have prompted investors to diversify their portfolios and seek to reduce risk.
- The total value held on Bitcoin has increased, indicating that investors are willing to place their faith in the cryptocurrency.
This week was one for the history books, and not just in the cryptocurrency world, as all three US-facing crypto banks were liquidated within three days. While some forecast Though it was a targeted attack, Bitcoin got out unscathed and increased in value.
In fact, since last Friday’s close, Bitcoin has seen a remarkable 30% increase, reaching its current trading price of $26,600.
This rally, along with gains for other cryptocurrencies, has caused the total cryptocurrency market cap to cross the $1.1 trillion mark. This impressive growth instills renewed confidence in investors and indicates a positive outlook for the crypto market.
Investors are turning to bitcoin as traditional banks struggle
This price rally was a reflection of Bitcoin’s ability to perform well in uncertain market conditions, with some analysts remaining wary of traditional markets, especially as liquidity concerns have surfaced in the wake of the recent crisis. SVB breakdown And Silvergate Banks.
In response, investors are increasingly diversifying their investment portfolios and looking to cryptocurrencies as a way to reduce risk and address the shortcomings of the existing traditional financial system.
This is in line with recent data Noting that the total value of locked Bitcoin has increased significantly, rising to $142.31 million. This is up significantly from the $84 million recorded at the start of the year, and represents the highest value secured since May 5, 2022.
The increase in the total value locked on the lighting network serves as an indication of the confidence of investors in the cryptocurrency and they are optimistic about its growth potential.
TVL Lighting Network and stats. source: DeFiLlama
Scales on the chain Screaming bull market
Glasnody “Recover from Bitcoin BearThe dashboard shows positive signs of a bitcoin recovery. The dashboard monitors eight major indicators to determine if Bitcoin is moving from a Alcohol market In the recovery period or new bull market.
Recover from Bitcoin Bear. source: glass
The dashboard monitors several important factors, such as Bitcoin price relative to major pricing models, network usage momentum, market profitability, and the balance of Bitcoin wealth in USD held by HODLers over the long term.
When all eight indicators are positive, the chart turns dark blue, which is a historically strong bullish sign for Bitcoin. Currently, seven of the eight indicators are positive, and the chart is highlighted in light blue.
While this alone doesn’t always indicate a bull market, when combined with other on-chain metrics it can be a good indicator, and investors have been eyeing the other color charts as well.
Bitcoin Stock-to-Flow Pricing Model. source: LookIntoBitcoin
The Bitcoin Stock-to-Flow pricing model indicates that the Bitcoin market cycle lasts about four years. This model uses the amount of BTC available in the market and the annual mining rate to estimate the fair price of Bitcoin. The current fair price suggested by the model is about $55,000, more than twice the current trading price of Bitcoin.
Bitcoin Rainbow Chart 2nd Edition. source: Blockchaincenter
In addition, the famous Bitcoin Rainbow Chart of Blockchaincenter.net shows that Bitcoin is currently being bought! The area, having recently recovered from a “primarily fire sale” area in late 2022.
on the flip side
- The recent rally in the price of Bitcoin may be short-lived, as concerns about the global economy and the possibility of lower interest rates linger. A wave of negative cryptocurrency news could lead to a sell-off and push the price of Bitcoin and other cryptocurrencies lower.
- While the total value held in Bitcoin has increased, the leading digital asset is still in the recovery phase and has not yet reached its previous high of $216.35 million.
- Glasnody The Bitcoin Bear Recovery dashboard has been reliable in the past, however, even when seven of the eight indicators appear bullish, a positive outcome is not always followed, highlighting the volatile nature of the market.
Why should you bother
After a long period of bearish movement, it is refreshing to see cryptocurrencies regain their bullish momentum. This latest increase, along with positive on-chain metrics, is a promising sign amid the struggles of traditional finance. Since cryptocurrencies were created to address the limitations of the current financial system, recent events are widely interpreted as a bullish sign for the future of the industry.
Looking for more news about bitcoin? Check out this article about the latest boom:
Bitcoin rises $7,000 in 4 days to break $26,000 as Kramer announces, “It’s time to sell”
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