Top Reasons Why Bitcoin May Start a New Bull Run Very Soon
Throughout the entire year of 2022, Bitcoin struggled. However, recent on-chain market statistics indicate that the top cryptocurrency by market capitalization has begun to show signs of improvement. The whole digital asset sector has suffered greatly during the bear market of 2022, with prices for both BTC and ETH falling by more than 75% from their all-time highs. Here are certain specific on-chain data, which may justify Bitcoin’s bull run theory, as highlighted by Cryptoquant.
Bitcoin Has Hit Rock Bottom in Current Cycle – On Chain Metrics
Bitcoin has gained around 12% since last week and is already challenging the $25,000 mark. The price of BTC has not been this high since mid-June 2022. Midway through January, the MVRV ratio for Bitcoin began to surge over 1, a sign that the price has already bottomed and begun a bull market cycle. At 1.22, the ratio is still low enough for investors to take advantage of the opportunity.
The percentage of the BTC supply held by long-term holders (LTHs), despite the active negative trend, is currently close to all-time highs. LTH supply only decreased by 1.3% after the FTX fall, indicating that HODLer’s belief is still very strong. 82.2% of the supply is now owned by LTHs, with 34.87% of that being held at an unrealized loss.
The net unrealized profit and loss (NUPL) display the overall profit and loss in all Bitcoin currently in use. Investors are in the black when the value is more than zero, and more investors are starting to be profitable when the value is trending upward. The value is currently 0.18.
The Puell Multiple, which showed a bottom formation in January, is currently 1.07, indicating a positive trend. It is the ratio of daily issuance to daily issuance moving average and verifies whether the price of Bitcoin is excessively high or excessively low in comparison to previous rates. Readings below 0.5 signify the formation of a bottom.