Understanding Bitcoin’s Euphoria Phase with Glassnode Analytics
If you’re wondering whether Bitcoin (BTC) is still in a euphoria phase despite recent market corrections, insights from Glassnode’s on-chain metrics analysis shed light on the current state of the crypto king. Here’s why Bitcoin’s downward price action might just be the beginning of a new bull run.
Glassnode’s Analysis of Bitcoin’s Market Cycle
According to Glassnode’s latest report, BTC’s recent price corrections are relatively mild compared to previous market cycles, indicating that Bitcoin is still in the early stages of an upward trend. Here are some key takeaways from Glassnode’s analysis:
- Historically Small Pullbacks:
- The magnitude of pullbacks in the current market remains historically small despite significant profit-taking by existing holders.
- Young Euphoria Phase:
- While the market is in a price discovery phase, the current euphoria phase is relatively young compared to previous cycles.
- Previous euphoria phases have experienced deeper price drawdowns, with corrections exceeding -10% and often reaching 25% or more.
- Shallow Corrections:
- Since breaking the all-time high, the current market has only seen two corrections of around 10% or more, indicating a resilient market sentiment.
Bitcoin Strength & Market Performance
Moreover, Glassnode’s on-chain analysis of major exchanges highlights the underlying strength of Bitcoin over the past year, driven by spot market inflows and new demand from market entrants. Here’s what Glassnode’s research reveals:
- Spot Trade Volumes:
- The surge in spot trade volumes and on-chain flows linked to exchanges has supported Bitcoin’s robust performance in the market.
- Strong Demand:
- Analysis of the Cumulative Volume Delta indicates a strong demand side, with bids favoring the maker side over the taker side, reflecting confidence in the market.
- Wealth Balance:
- While profit-taking has increased with Bitcoin surpassing the 2021 ATH, a balance between long-term holders and new demand signals that the euphoria phase is still in its early stages historically.
Hot Take: Bitcoin’s Euphoria Phase Decoded
As per Glassnode’s insightful analysis, Bitcoin’s euphoria phase is yet to reach its peak, with the current market sentiment indicating a potential for further growth and price discovery. Stay tuned to witness how Bitcoin’s journey unfolds in the coming weeks and months.
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