With BTC’s price regaining traction and heading towards $40,000, it’s worth reviewing four (ok, five) reasons why you should be more bullish.
Although bitcoin has already added $10,000 of value in a week to $40,000, some on-chain features suggest even more bullish developments awaiting right around the corner. From the Stablecoin Ratio to increasing active addresses to corporations buying and holders still holding.
Reason 1: Bitcoin to Stablecoin Ratio
According to data from CryptoQuant, the Bitcoin to stablecoin ratio oscillator has gone into bullish territory. This metric highlights the ratio of the number of bitcoins to stablecoins stored on all exchanges.
The analytics company said this metric has a “perfect BTFD hit rate since 2019.” CryptoQuant encouraged BTC bulls by adding, “it just printed another buy signal,” as the stablecoins sitting on exchanges have far superseded the bitcoins, suggesting more potential purchases.
It’s worth noting that the Bitcoin Stablecoin Supply Ratio, which works similarly, has also been declining in the past few months.
Reason 2: The Bottom Is In?
Jurrien Timmer, the Director of Global Macro at Fidelity Investments, also opined about BTC’s recent price developments. In fact, he believes the massive price slump towards $30,000 was actually the bottom.
He came to this conclusion by comparing the BTC/USD chart with the GS Retail Favorites Basket. History shows that the correlation between the two has been relatively high, suggesting that bitcoin could indeed mimic the basket’s performance.
Reason 3: Corporations Keep Buying, Institutional Praise
While some reports suggested that short-term investors had sold off their BTC holdings during the recent crash, others have only doubled down. Such is the case with MicroStrategy.
Michael Saylor’s NASDAQ-listed business intelligence giant plans to allocate another $1 billion in the primary cryptocurrency after a new stock offering.
The executive, who became among the most prominent BTC bulls in the past year, took it to Twitter to advise those who plan to have 5% of their portfolios in the asset that the remaining 95% will be “demonetized by bitcoin.”
Read more: CryptoPotato