Glassnode Analysis Suggests There Are Still Positive Bitcoin On-chain Metrics
Top crypto channel Altcoin Daily shares a detailed Bitcoin (BTC) on-chain metrics analysis of Glassnode that explores both the Bull and Bear cases using a combination of market and on-chain metrics.
“The market tests the lows of a significant on-chain support zone, transaction activity remains depressed, and HODLing behavior shows remarkable resilience.”
Bearish Case for Bitcoin
According to the crypto KOL, the limelight this week will be the performance of the Grayscale GBTC product with around 31.9k GBTC shares unlocking through the remainder of July:
“The GBTC market price continued to trade at a notable discount last week, ranging between -11.0% and down to -15.3%…Any significant and persistent discount suggests lackluster demand and can also attract capital away from spot BTC markets,”
Moreover, the Purpose ETF has also seen a slow-down in net inflows this week, after a period of relatively strong demand through May and June.
“The week closed with the largest net outflow of -90.76 BTC since mid-May. Similar to the GBTC product, this indicates institutional demand remains relatively weak across these regulated products,” the trader says.
Importantly, On-chain activity (volume and entities) remains significantly down from the highs. Utilization of the Bitcoin network for value transfer suggests low demand. Besides, Losses continue to be realized on-chain, and a total of 6.2M are currently held at an unrealized loss. These coins may well form overhead resistance and sell-pressure.
The Bull Case for Bitcoin
According to the analyst, there remain positive signs across many on-chain metrics, particularly longer-range indicators and supply metrics.
Long-term holders and bull market HODLers appear unshaken by volatility and lower prices:
“If we observe the volume of supply held by ‘strong hands,’ we can see that HODLing appears to be the preferred strategy. Long-Term Holders currently hold 75% of the circulating supply, 6% at a loss, 69% in profit,”
Besides, the volume of coins held in illiquid state continues to grow, and the potential supply squeeze is coming from a much higher base than the 2018-19 bear.
This demonstrates the remarkable conviction of BTC holders to weather extreme volatility.