Glassnode: “BTC will continue to grow on the back of investor confidence»

Glassnode: “BTC will continue to grow on the back of investor confidence»

According to analysts of Glassnode, bitcoin will continue to grow, as investors do not show a desire to close positions and continue to buy BTC.

According to a report by
the analytics company Glassnode, on the adjusted Return on Bitcoin’s spent output (aSOPR), further price declines will leave many investors in the red depending on when their assets were last moved online.

Although many investors now have unrealized gains on this indicator, Glassnode interprets the data as optimistic and states:

“For SOPR to decline, investors must be prepared to sell at a loss, which is unlikely given the current state of the market.”

Glassnode describes SOPR as a measure of the profitability ratio of coins based on the price of BTC when they were last moved within the network. Since aSOPR is an intra-network indicator, the circulation of BTC on centralized exchanges is not taken into account.

While the SOPR usually hovers around level 1, the extreme bullish momentum of recent months has led to a sharp jump in Bitcoin’s aSOPR above 1.15 in late December and the first half of January. However, in a bull market, the aSOPR value does not fall below 1, because traders do not want to sell at a loss.

The aSOPR chart suggests that the current correction is coming to an end. From peak to low, BTC corrected by 31% when it fell on January 22
just under $29,000. Bitcoin is currently trading
at $31,879.

Glassnode also reported yesterday that 2.3 million BTC, or 12.6% of the bitcoins in circulation, were moved internally when the crypto asset was trading above $30,000, labeling this activity as ” bullish»:

“This is very important, given that this year alone, BTC has exceeded $40,000. This suggests that investors are investing capital and, therefore, are confident in further price increases.”

Recall that according to Skew, recently the volatility of bitcoin has risen
up to the level of March 2020, when all markets collapsed at the beginning of the pandemic. Previously, volatility reached maximum levels during periods of a “bull” market.