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Bitcoin is gaining momentum, but on-chain metrics are warning caution.
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The US economic resilience could offer support to the cryptomarket.
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Kamala Harris’ potential crypto policies raise regulatory uncertainties.
Bitcoin has risen nearly 28% since its recent low of $49,900. It is now back near the $60,000 mark. This rebound comes after a notable fall in August when Bitcoin’s price fell by 33.32% compared to its cycle high of $75,666. This was the largest decline of the current cycle.
At the time of publication, Bitcoin’s price was $59,676.84, with a 24-hour volume of trading of $35,050.958,497. Bitcoin is down by 1.24% over the last 24 hours, with a market capitalization of $1,177.959.350.244. Over the past 7 days, Bitcoin’s value has increased by 8.88%.
The Mayer Multiple is one of the key metrics that shows the severity of the downturn. The Mayer Multiple dropped to 0.88, a value not seen since November 2022’s FTX collapse. This indicates that Bitcoin is in a bearish phase with its price trading well below its historical average.
Source: Bitfinext-Alpha-117
On-chain metrics highlight the intensity of recent selling. The Short-Term Holder Realised Price (STH cost-basis) is currently $64,860. Bitcoin’s spot rate recently touched the -1 SD band below this STH cost-Basis. This is a rare occurrence seen in only 7.1% trading days. This shows the severity of the current market.
The Short-Term Holder MVRV ratio also reveals significant losses that have not been realized by newer investors. This is the highest level since the bear market lows of 2022. These metrics indicate a deep-seated bearish sentiment among short-term investors and a high level of stress, which typically occurs at the bottom of local markets.
Source: Bitfinext-Alpha-117
The US economy is resilient despite fears of a possible slowdown. Recent data shows a decline in jobless claims, and an increase in wholesale inventories. This boosts economic growth. The level of household debt has increased slightly, putting more financial pressure on consumers. Despite this, the delinquency rate remains stable, indicating continued support for economic activities.
In July, the US services industry saw a noticeable rebound, with new orders rising and employment in the sector increasing for the first six-month period. This recovery could help ease fears of a recession amid recent stock market volatility.
Kamala Harris, who is now the frontrunner in the US presidential race for 2024, has shifted her focus. As her team meets with executives in the industry, speculation about her possible cryptocurrency policies is increasing. This development could have an impact on cryptocurrency regulations in the upcoming months.
Major financial institutions are also making progress in the digital asset markets. BlackRock and Nasdaq asked the SEC to allow options trading on BlackRock’s spot Ethereum-linked ETF. This comes after the SEC approved several Ethereum-linked ETFs.
The SEC has however delayed the approval of Hashdex’s proposed ETF which aims at holding spot Bitcoin and Ether. This delay, which extends until September 30, 20,24, shows SEC’s cautious attitude.
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