The last quarter of 2023 was quite eventful for Bitcoin (BTC). The crypto king surged to its highest level in 19 months on December 16, reaching $44,700. Since then, Bitcoin has retracted somewhat, leading some to speculate that it might be entering or about to enter a downtrend. However, the on-chain analysis company CryptoQuant reported this week that BTC is correcting after climbing very fast, but the crypto king continues to remain in a bull market, and the bear market is a thing of the past. Here are eight key signals indicating that the Bitcoin bull market is not over yet.
Block Generation Time Surpasses One Hour
There are now so many miners connected to the Bitcoin network to process transactions securely that the core protocol adjusted BTC’s difficulty target to about 68 T on November 26, the highest level of all time. Just two weeks earlier, on November 7, when Bitcoin’s SHA-256 difficulty level reached the highest level of that time at 62.46 T, something interesting happened; the time to produce a new block on the Bitcoin network took a full 43 minutes.
But then something even more interesting happened… After it took 43 minutes to extract block number 815,689 on the Bitcoin network, it took 66 minutes to extract the next block. There is currently an excessive miner density on the Bitcoin network, and they are fiercely competing to keep up with all the hash power they have added to secure the network and ensure that new blocks are produced on time every ten minutes.
At this point, let’s mention that the difficulty adjustment on the Bitcoin network is made every 34 days on average because the difficulty adjustment is calibrated to maintain the time between blocks at an average of ten minutes as a result of probabilistic processes.
The World’s Largest Asset Management Company Pursues Offering a Bitcoin ETF
The fact that BlackRock, the world’s largest asset management company, has been striving since June to offer a regulated spot Bitcoin ETF for its clients signals a historic moment for the largest cryptocurrency. Until a while ago, BlackRock did not even consider Bitcoin a legitimate asset. BlackRock CEO Larry Fink, who said in 2018 that they would not offer a crypto ETF until the industry was legitimate, was indeed in a very different market dynamic at that time. Since then, things have changed rapidly, and BlackRock is now pursuing to offer a spot Bitcoin ETF.
70% of Bitcoin’s Circulating Supply Has Not Moved for a Year or More
Although Bitcoin has outperformed spot gold, fixed-income bonds, and stock indices in the last two months, most investors continue to hold their BTCs without selling. As we moved from November to December, about 83% of the circulating BTCs were held profitably. Nevertheless, a large majority of these BTCs remained immobile and continue to do so.
Data obtained from Bitcoin’s public Blockchain shows that about 70% of the current circulating supply, that is, 13.65 million BTCs, have been sitting without movement since last year or even longer. This indicates that the proportion of long-term investors in the asset class is quite high and that investors have a strong belief that the bull market will not end in the short term.
CME Group Has More Futures Trading Volume Than Binance
Futures contracts are agreements between two parties to buy or sell an asset at a specific price on a specific date. Investors can benefit from price fluctuations or manage their risks using futures contracts.
At CME Group (Chicago Mercantile Exchange), the world’s leading large derivatives market for regulated investors, the open interest (OI) in Bitcoin futures contracts recently surpassed the OI at Binance, the world’s largest cryptocurrency exchange. According to data provided by Glassnode, this happened at the beginning of November.
The OI of Bitcoin futures at CME surpassed Binance for the first time since the 2021 bull market. CME continues to lead in OI for Bitcoin futures with contracts worth $4.56 billion (109,000 BTC) in December, compared to Binance’s $4.15 billion (99,000 BTC), indicating that institutional interest in Bitcoin continues.
Bitcoin Futures Signal a Rare Bullish Indicator
Speaking of Bitcoin futures, the CME markets gave another rare bullish signal at the end of November: Contango. This term refers to a situation where the futures price of an asset is higher than its spot price.
According to an asset manager at CoinShares, a Europe-based digital assets hedge fund, contango has been a rare occurrence in Bitcoin futures markets since 2018. The CoinShares manager believes that particularly contango reaching double-digit figures indicates an extreme bullishness.
Whales Continue to Buy Bitcoin
Meanwhile, as regulated investors chase gains in Bitcoin futures with excessive leverage, mysterious whales continue to appear, purchasing large amounts of the small circulating BTC supply.
The number of whale-level wallet addresses holding between one thousand and ten thousand BTCs increased significantly in August, just a few weeks before the bull run that began in October. These high-capital investors have continued to buy BTC at every price drop, seeing it as an opportunity. For example, an anonymous Bitcoin whale that started accumulating BTC in January of this year is now waiting with unrealized gains of over $100 million.
4-Year ‘Flag Channel’ Formation on the Bitcoin Price Chart
Analysts continue to make bullish comments, noting that Bitcoin’s price chart is following a definitive formation of a parabolic price increase drawn in previous 4-year BTC cycles. Experienced crypto analyst TechDev drew attention to this formation at the end of November, reminding his followers that it was a parabolic price signal in the previous three multi-year cycles.
Analysts Make Extremely High Price Predictions for Bitcoin
Although it is impossible to know the future price of any asset traded until the markets move, many analysts have been giving extremely high price targets since the rally began in October.
In an analysis put forward by experienced crypto analyst CryptoCon in November, it was suggested that Bitcoin’s price could reach $47,000 in December or January. Indeed, the analyst’s prediction is about to come true. Another crypto analyst, Titan of Crypto, said that the target level is $50,000 immediately after the block reward halving in April 2024.
The British bank Standard Chartered made an ambitious prediction that Bitcoin will reach $100,000 in 2024. The digital assets team at VanEck agrees. Blockstream CEO Adam Back made an ambitious forecast that BTC will reach $700,000 in 2024 or 2025.
