The Aftermath of the Bitcoin Crash
Last week, the Bitcoin price surged above $45,800 before experiencing a sharp pullback due to negative news about the BTC spot (ETF). However, on-chain data suggests that investors still have faith in Bitcoin.
$2.5 Billion Flows Back Into Crypto Market
Crypto analyst Ali Martinez reveals that a significant amount of funds flooded back into the crypto market following the crash. This insight is based on on-chain data from Glassnode, specifically the “positive 30-day capital inflows” indicator.
According to Glassnode’s data, over $2.5 billion flowed back into the cryptocurrency market on January 4th, bringing the positive 30-day capital inflows to about $27.5 billion. This influx of capital signals renewed investor confidence in crypto assets after a period of uncertainty and price correction.
How BTC Holders Reacted
An analysis using the Spent Output Age Bands USD (SOAB) indicator on CryptoQuant shows how different classes of Bitcoin investors reacted to the negative ETF news and subsequent decline.
Short-term holders exited the market at break-even and profits, while long-term holders who purchased Bitcoin in the first half of 2023 dumped about $7.6 billion worth of BTC. The 1-year-to-5-year holder class remained relatively unaffected.
Hot Take: Renewed Confidence in Bitcoin
The recent influx of capital into the crypto market indicates a positive shift in sentiment and market condition. Despite the Bitcoin crash, investors have shown renewed confidence in crypto assets. While the Bitcoin price has declined slightly, it is recovering well and may soon reach $44,000 again.
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