Key Takeaways
- Grayscale's report suggests Bitcoin is in the mid-phase of a bull run.
- Grayscale claims that spot Bitcoin ETF inflows and decreasing BTC balances on exchanges are key market drivers.
- The report claims retail investor sentiment is improving, indicating potential for continued price growth.
Grayscale’s recent analysis indicates that Bitcoin is currently in the midst of a bull run.
The firm’s report highlights a combination of fundamental and technical factors supporting this phase.
Key indicators of the bull run
The analysis suggests that Bitcoin’s historical cyclical behavior is once again in play, with the current phase being driven by factors such as spot Bitcoin ETF inflows, stablecoin supply, and decreasing BTC balances on exchanges.
Notably, spot Bitcoin ETF inflows have consistently outpaced the amount mined daily by miners, exerting upward pressure on prices.
This cycle also features healthy on-chain fundamentals, including a surge in stablecoin inflows and an increase in Total Value Locked (TVL) in applications, contributing to the market’s momentum.
Market sentiment and future outlook
While retail investor interest remains subdued compared to the 2021 bull market, Grayscale’s report highlights potential for growth.
The firm uses various metrics, such as the Market Value Realized Value (MVRV) and the MVRV Z-Score, to assess the progress of the current bull cycle, suggesting that we are in the “mid-phase” with room for continued growth.
Grayscale advises to watch spot Bitcoin ETF flows and macroeconomic factors closely for signs of market shifts.
Despite the market’s vigorous ascent in early 2024, Grayscale emphasizes the importance of maintaining a long-term view, given the inherent volatility of cryptocurrencies.
