Glassnode co-founders Jan Happel and Yann Allemann suggest that Bitcoin may have bottomed out after a correction, as long-term holders have sold less aggressively compared to earlier in the year. They also express optimism about the AI-based crypto project, Artificial Superintelligence Alliance (FET), which they believe is poised for a rally due to its strong fundamentals, neutral RSI, and accumulation phase. FET is currently trading at $1.62, up 8.1% in the last 24 hours.
Glassnode co-founders predict Bitcoin will reach new all-time highs if the US Dollar Index (DXY) declines due to the Federal Reserve's rate-cutting and quantitative easing. A weaker DXY typically leads investors to favor risk assets like Bitcoin. Currently, Bitcoin is trading at $89,200, slightly below its all-time high. Meanwhile, Ethereum shows market strength despite a decline against Bitcoin, with its market cap remaining relatively stable.
Glassnode analysts report that the Bitcoin market has entered a "euphoric phase" with spot trade volume reaching levels seen during the 2020 to 2021 bull market, driven by both spot trade volume and exchange deposits and withdrawals. The market is still in its early stages of euphoria, with profit taking on the rise. The surge in trading volumes followed the approval of spot bitcoin exchange-traded funds (ETFs) in January, with daily trading volumes peaking at $14.1 billion in March. The Fear and Greed index currently sits at a reading of 78, indicating "extreme greed" in the market.
Glassnode's latest investigation into on-chain activity reveals that short-term holders (STHs) are responsible for the recent speculative behavior in Bitcoin, including profit-taking. The market value to realized value (MVRV) metric shows that STH-MVRV is falling towards its equilibrium point of 1.0, where the spot price matches the cost basis. For this to complete, BTC/USD would need to fall to $24,400. Long-term holders (LTHs) have also been selling into rallies, increasing the overall share of BTC classed as "young supply." Overall, LTHs remain in control of the supply, with net new entries "relatively soft."
Bitcoin's reserve-risk multiple has turned positive for the first time since October 2021, indicating the onset of a major bull market. The reserve-risk multiple is a long-term cyclical indicator that compares the incentive to sell at the going market price with long-term holders resisting the temptation to liquidate. Previous crossovers above zero with the reserve-risk multiple paved the way for sharp price rallies, with gains of up to 6,400%. The latest positive crossover suggests that bitcoin's recent rally to 10-month highs may be only the first milestone in its upward journey, with the cryptocurrency's fourth reward halving due in April next year.
According to a report by Glassnode, Bitcoin has established a strong foundation below the $30,000 level, with similarities to early 2016 and early 2019 in terms of supply structure. Long-Term Holder (LTH) supply is just shy of a new all-time high, while short-term holders (STH) have seen their supply balance remain relatively constant. The report highlights the importance of patience in a market cycle and suggests that while a bull run may not arrive shortly, BTC is unlikely to visit prices below the $15,500 level.
Only 253 validators have signed up to fully exit their staked Ether position after the Shanghai hard fork on Ethereum, according to Glassnode. The analytics firm predicts that only 170,000 ETH of the total 18.1 million staked on the Beacon Chain will be unlocked within the first week of the upgrade, with mechanisms in place to prevent a flood of Ether supply from hitting the market all at once. Glassnode expects a large amount of Ether to be withdrawn from Kraken after the legality of its staking services was challenged by the SEC, but it is unlikely to happen immediately after the upgrade.
