- Bitcoin performance suggests that the bottom might already be in, however analysts are waiting for a full year to pass since the 2022 bear market rally.
- Bitcoin on-chain flows show the amount of Bitcoin transferred from miner addresses to wallets owned by exchanges has declined to multi-year lows.
- BTC is on track to climb higher with reducing on-chain flow of Bitcoin from miner addresses to wallets owned by exchanges.
Bitcoin is currently in a bear market, according to analysts despite the massive rally of January. The selling pressure on the asset has reduced with miner inflow to exchanges declining to multi-year lows. Despite the bullish catalysts, analysts are waiting for a year post the 2022 bear market rally to conclude that the bearish phase is now behind us.
Bitcoin performance signals last phase of bear market
Bitcoin price performance suggests that the bottom might already be in. Despite these signals, analysts at cryptocurrency exchange Bitfinex argue that we need to wait for a full year to pass since the 2022 bear market rally to conclude that the bottom is in and the bear market is behind us.
Analysts told traders in a note that,
Early 2020, before the third bitcoin rally of eight green candles, was a time of massive volatility amongst bearish macro conditions; this might be what we experience now in the first and second quarters of 2023.
The note cited that long-term holders continue to hold massive spot positions, a bullish catalyst for the asset.
Short-term holders are selling BTC at a profit while long-term holders accumulate
Bitcoin miners inflow to exchanges hit multi-year low
The selling pressure on Bitcoin from miners hit three-year lows. Miners are entities that supply computing power to the Bitcoin network in return for “rewards” in the form of tokens. Miners sell their BTC rewards to recover operational costs.
Throughout the prolonged bear market of 2022, Bitcoin miners filed for bankruptcy protection, liquidated holdings, contributing to selling pressure in the market. A reduction in miner sales implies selling pressure on Bitcoin is weakening, this makes it a bullish development for BTC.