Short-term holders seize opportunity as Bitcoin skyrockets to $66k
According to analysts at CryptoQuant, although large investors are showing interest in Bitcoin, the growth has not yet accelerated enough to sustain the rally. The price of Bitcoin managed to reach $66,000 on Wednesday after news of lower-than-expected inflation in the US, resulting in minimal or no profit for short-term holders who are selling. CryptoQuant’s research report states that these short-term holders are selling at almost no profit, but the growth still needs to accelerate to make the rally sustainable. The report also mentions that the balance of Bitcoin at over-the-counter desks has stabilized since late April, indicating a decrease in the supply of Bitcoin entering the market through these channels. However, analysts warn that stablecoin liquidity growth, which is typically associated with sustainable price rallies, is slowing down from a market liquidity perspective. The analysts also note that Bitcoin’s price is relatively undervalued from a miner profitability standpoint. On the other hand, analysts at blockchain firm Kaiko suggest that Bitcoin’s recent halving may soon compel miners to sell their crypto holdings if prices do not recover quickly. This is because the daily average network fees, which initially provided some relief for miners, are now decreasing. Kaiko explains that these fees spiked after the halving but have since cooled off along with the initial excitement about the Runes protocol. According to Kaiko, Bitcoin’s halving is unlikely to affect its price in the next 18 months.
