Bitcoin Supply Structure Very Similar to Early 2019, Bull Run Ahead?

Bitcoin (BTC), the largest cryptocurrency in the market, reached a new annual high last week. However, since then it has traded within a new range between $29,500 and $30,000, failing to consolidate above this key level and continue its rally towards higher territories.

According to new data analyzed by Satoshi Club, a leading cryptocurrency platform, Bitcoin has built a strong foundation below $30,000, with the current supply structure similar to early 2016 and 2019. This news comes as a promising sign for bulls, and suggests that Bitcoin’s future may be brighter than previously thought.

Is Bitcoin Ready for New Highs?

According to the Satoshi Club, the supply distribution of Bitcoin has been split into two: pre-FTX collapse for long-term holders (LTH) supply and post-collapse for short-term holders (STH) supply. This has resulted in LTH supply near all-time highs for several months or even a year.

Furthermore, according to the Satoshi Club, BTC’s long-term holder supply has reached a new all-time high of 14.161 million BTC. Meanwhile, the supply of short-term holders remains stable at 2.914 million BTC.

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The last bull runs in 2016 and 2019 took 18-24 months to start, and during these times Bitcoin saw a rapid increase in long-term holdings in profit, followed by profit-taking. Currently, Bitcoin is experiencing strength in its price, with year-to-date (YTD) gains supported by an “explosive increase” in coins held for profit.

This means that more and more investors are holding on to their BTC, as they are currently in profit. This is a positive sign for the market as it indicates that investors have faith in the long-term potential of Bitcoin.

In addition, Satoshi Club highlights that in the current market environment, the fundamentals of Bitcoin appear to be much stronger than in previous bear markets. By 2023, 6.2 million Bitcoin returned to profit, representing 32.3% of the total supply. This indicates a strong cost base below $30,000, which is a positive sign for the long-term outlook of BTC.

Also, according to the Satoshi Club, Bitcoin is unlikely to visit prices below $15,500 in the near term. This prediction is based on the current supply structure of Bitcoin, which indicates that there is significant support for the cryptocurrency at this price point.

BTC Bulls Rejoice

CryptoQuant, a leading platform for analyzing crypto market data, has released a analysis on the use of the “net volume” movement to predict Bitcoin price swings in the futures market. The analysis suggests that using a 72-day moving average to analyze the difference between long and short position volumes can help to some extent in predicting BTC price fluctuations.

According to CryptoQuant’s analysis, the current Bitcoin position in the futures market is similar to that observed in November and December 2020. From a sentiment perspective, the potential for Bitcoin’s price to rise is greater as increasing short positions are liquidated.

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At the time of writing, the largest cryptocurrency in the market is trading at $30,000 and has been trading sideways for the past 24 hours. However, if BTC can maintain its current trading zone, there is potential for it to bounce off the support level and reach new yearly highs.

Featured image from Unsplash, chart from TradingView.com