Insight #32

Against the backdrop of macro concerns and hacking attacks, Bitcoin maintains a bullish sentiment. Learn the details in the new report!

Macroeconomics

1. Falling Stock Markets and Declining Consumer Sentiment

Priority: High

Key Data:

- U.S. Indices: The S&P 500 fell by 1.7%, the Nasdaq by 2.1%, and the Dow Jones dropped by 748 points – the largest decline this year.

- The University of Michigan Consumer Sentiment Index was revised downward to 64.7 (from a preliminary value of 67.8), while one-year inflation expectations rose to 4.3% and the five-year forecast to 3.5%.

Link to Bitcoin:

A sharp decline in the stock market and deteriorating consumer sentiment increase overall economic uncertainty. Investors may seek alternative assets to hedge against the volatility of traditional markets and inflationary risks, which could support demand for Bitcoin.

2. Upcoming Economic Data and Fed Commentary (Week Ahead)

Priority: High

Key Data:

- Next week, a series of key releases is scheduled: speeches by Federal Reserve officials, the publication of data on personal income and spending, the PCE index, durable goods orders, the second estimate of Q1 2025 GDP growth, and an updated CB Consumer Confidence Index.

- Also in focus are housing market data (new and pending home sales) and corporate reports from major companies (Nvidia, Home Depot, Salesforce, etc.).

Link to Bitcoin:

- Market turbulence on the back of key macro data releases may trigger a capital inflow into alternative assets, such as Bitcoin, making it attractive amid rising economic uncertainty.

3. Yield on 10-Year German Bonds, Political Uncertainty, and Tariff Threats

Priority: High

Key Data:

- The yield on 10-year German bonds has fallen below 2.5%.

- Markets are pricing in monetary easing in the Eurozone (up to 78 basis points of rate cuts) amid stagnant business activity: slight acceleration in Germany, but a sharp contraction in France.

- Additionally, political uncertainty is compounded by upcoming elections in Germany and tariff policies from President Trump, namely the plan to impose a 25% tariff on automobiles, semiconductors, and pharmaceutical products starting April 2.

Link to Bitcoin:

- Heightened geopolitical and trade risks, as well as expectations of monetary easing, may drive investors to seek refuge in assets with an independent monetary policy, such as Bitcoin.

4. S&P Global Services Business Activity Index (U.S.)

Priority: Medium

Key Data:

- The U.S. services business activity index sharply declined to 50.4 in February 2025 from 52.7 in January, indicating near stagnation in the private sector.

- There was a noted slowdown in new order growth, a modest decline in employment, and a deceleration in price increases.

Link to Bitcoin:

- A slowdown in the services sector signals broader economic challenges, which might prompt investors to seek alternative instruments for diversification. In this context, Bitcoin is viewed as a hedge against fiat risks.

5. Existing Home Sales in the U.S.

Priority: Medium

Key Data:

- Existing home sales in January 2025 fell by 4.9% to 4.08 million units – the sharpest decline in seven months, with the average home price dropping by 1.9% to $396,000.

- The inventory of unsold homes increased to 3.9 months of supply.

Link to Bitcoin:

- A decline in housing market activity indicates a slowdown in economic growth. This trend may prompt investors to search for alternative instruments to diversify their portfolios, among which Bitcoin holds an important place.

The most influential factors for Bitcoin are news related to falling stock markets, deteriorating consumer sentiment, expectations for monetary easing, and geopolitical risks. These factors intensify uncertainty and may encourage a capital inflow into alternative assets, including Bitcoin.

Important News from the Past Week

1. Security Incidents and Cyber Threats

Priority: High

- Bybit – $1.4 Billion Ethereum Hack

- A confirmed incident linked to the North Korean Lazarus Group.

- This is one of the largest cryptocurrency thefts in history, which could heighten investors' concerns about the security of digital assets and affect trust in the crypto market infrastructure.

2. Regulatory and Institutional Initiatives

Priority: High

- SEC and Legal Developments

- The Securities and Exchange Commission (SEC) has essentially agreed to drop its case against Coinbase, pending commissioner approval – a significant victory for the exchange and the industry as a whole.

- The SEC has withdrawn its appeal against the “dealer rule” for cryptocurrencies, marking a legal triumph for DeFi and liquidity providers.

- The establishment of the SEC’s cyber unit, CETU, led by Lora D'Aliard, is aimed at combating fraud and supporting the growth of the crypto industry.

- The SEC has advanced the approval process for spot ETF applications for XRP and Litecoin from CoinShares and Canary Capital, as well as recognized 21Shares’ proposal to allow staking in its Ethereum ETF.

Central Bank and Exchange Initiatives

- The ECB is planning to create a blockchain-based payment system for financial institutions, promoting the adoption of a digital euro.

- Nasdaq has proposed Rule 5712, which allows the listing of securities based on digital assets, opening new opportunities for crypto investments.

Banking and Government Actions

- State Street and Citi Bank are launching cryptocurrency custody services, demonstrating the transition of traditional banks to digital assets following regulatory changes.

- The Wisconsin Investment Board disclosed an investment of $321 million in BlackRock’s Bitcoin ETF, signaling growing acceptance of crypto assets at the state level.

3. Major Corporate Operations and Market Innovations

Priority: Moderately High

ETF Launches and New Investment Products

- Franklin Templeton is launching a Bitcoin-Ethereum ETF (EZPZ) on Cboe BZX following the debut of the combined Hashdex ETF – expanding the product lineup for institutional investors.

- Franklin Templeton is also introducing a tokenized U.S. Treasury fund in Luxembourg, providing access to innovative instruments for European investors.

Market Activity and New Derivatives

- The trading volume of spot Bitcoin ETFs in the U.S. has exceeded $750 billion, with BlackRock’s IBIT leading with a 75% market share – an indicator of high institutional investor interest and activity.

- Coinbase is launching CFTC-regulated Solana futures in the U.S., stimulating institutional adoption and potentially paving the way for a future SOL ETF.

Financing and Accumulation Strategies

- Strategy announced the issuance of convertible bonds totaling $2 billion at 0% interest to finance additional Bitcoin purchases – a strategic move to increase Bitcoin’s share in the portfolio amid losses.

Conclusion:

The news this week is characterized by significant developments in regulation and institutional initiatives, which create legal certainty and enhance confidence in crypto assets. Simultaneously, major corporate launches and innovative products confirm growing investor interest. However, despite these positive shifts, concerns remain in the realm of cybersecurity – the Bybit incident may negatively affect trust in crypto market infrastructure and prompt further security measures.

Overview of Bitcoin Trading for the Week

The chart shows the formation of a narrowing range that has developed recently, from which the price broke downward while absorbing liquidity, and then generated a bullish impulse up to the $99.5K level. A negative factor was the resonant security incident at the Bybit exchange.

Technical Overview

- After a period of local consolidation in the range $93.4–$99.5K, the market attempted a recovery; however, negative news and security concerns temporarily cooled buying interest.

- The current level of $96.5K lies closer to the middle of the range, and further movement will depend on the market’s ability to digest the negative news and return to a positive news backdrop (for example, the launch of new ETFs or further institutional initiatives).

Fundamental Factors

- Despite the Bybit incident, the industry continues to witness the emergence of new ETFs and an expansion of cryptocurrency custody services by major banks. This creates a counterbalancing positive impulse, especially for long-term investors.

- The level of institutional interest in Bitcoin and crypto assets remains high, although in the short term the market may adopt a “wait-and-see” stance as it assesses risks from cyberattacks and regulatory actions.

Summary

- Negative Factors (the major hack, rising security concerns) have temporarily weakened the bullish sentiment, with the price consolidating around $96.5K.

- Positive Factors (the launch of new ETFs, institutional news) continue to provide fundamental support for Bitcoin in the medium and long term.

Bitcoin Market Data

Market Price: $96,482.99 | 1W Change: -0.79% | 1M Change: -8.18%

52-Week Range: $51,697 – $106,742

Market Capitalization: $1,915,016,273,690 | 1W Change: -1.03% | 1M Change: -7.01%

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Key Market Metrics

Daily Transfer Volume: 115,052 BTC | 1W Change: -75.61% | 1M Change: -83.49%

BTC Reserve on Exchanges: 2,461,295 BTC | 1W Change: -0.39% | 1M Change: -2.98%

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Fundamental On-Chain Metrics

Network Hashrate: 788,864,727,617 EH/s | 1W Change: -13.13% | 1M Change: +5.64%

Daily Miner Fees: $252,227 | 1W Change: +65.94% | 1M Change: -12.48%

Number of Active Wallets: 252,227 | 1W Change: -74.19% | 1M Change: -79.39%

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Weekly Conclusions:

1. Price and Capitalization

- The slight decline in price (-0.79%) and market capitalization (-1.03%) indicates some caution among investors, but there is no evidence of significant capital outflow.

2. Daily Transfer Volume and Active Wallets

- The sharp drop in daily transfer volume (-75.61%) and the reduction in the number of active wallets (-74.19%) may signal a decrease in short-term speculative activity. This could be due to overall market uncertainty or a shift in focus among participants to other assets.

3. BTC Holdings on Exchanges

- The modest decline in BTC held on exchanges (-0.39%) suggests that users continue to move some coins to private wallets, though the pace is low, which does not indicate panic or a mass exodus from exchanges.

4. Hashrate and Miner Fees

- The network hashrate fell by 13.13% over the week but remains on an upward trend on a monthly basis (+5.64%). This short-term decline might be due to disruptions in large mining pools or seasonal factors (e.g., energy costs).

- The sharp rise in miner fees for the day (+65.94%) could indicate a temporary increase in network load or heightened demand for transaction inclusion in blocks (situations with a congested mempool).

Overall Picture:

The Bitcoin market exhibited a slight price decline over the week amid the Bybit exchange hack, along with a significant drop in activity (transfer volume, active addresses) which is considered a bullish signal. Meanwhile, fundamental indicators such as the overall network hashrate remain relatively stable on a monthly basis, and the increase in fees reflects temporary spikes in network load. Collectively, the data suggests that market participants are adopting a “wait-and-see” stance rather than signaling a deep downtrend.

On-Chain Metrics

Bitcoin: Growth Rate (Market Cap vs. Realized Cap) 365DMA

The Bitcoin: Growth Rate (Market Cap vs. Realized Cap) 365DMA metric demonstrates how quickly the market capitalization is growing relative to the realized capitalization (the average “real” cost basis of coins in circulation). A decline in this metric may indicate a weakening capital inflow or a slowdown in the price growth relative to the aggregate cost at which market participants purchased BTC. However, it is important to note that even with a drop in this differential, the market can remain in a zone where the current price still significantly exceeds the averaged “realized” level. This suggests that most holders remain in profit and that overall sentiment stays bullish.

Additional arguments in favor of the continuing bullish trend include fundamental factors such as a consistently high network hashrate, rising institutional interest, and the emergence of new investment products (ETFs, futures). Thus, even if the growth rate slows, the very fact that market capitalization far exceeds realized value indicates a strong investor base that is not yet eager to exit the market. Consequently, despite a local decline in the metric, the long-term structure of the Bitcoin market remains healthy and bullish.

Bitcoin: Adjusted MVRV (30DMA/365DMA)

The Bitcoin: Adjusted MVRV (30DMA/365DMA) metric shows the ratio between the short-term and long-term “realized value” of Bitcoin. In simple terms, the MVRV (Market Value to Realized Value) indicates how much the market capitalization exceeds the aggregate purchase price of most coins. The “Adjusted” version takes into account additional filters and excludes certain transactions for a more precise analysis, while the comparison of the 30-day and 365-day moving averages highlights transitional phases in market participants’ behavior. When the short-term MVRV exceeds the long-term, it typically signals that recent buyers are in significant profit, indicating a bullish market structure.

The chart shows that under a bullish configuration, the aMVRV (30DMA/365DMA) metric consistently remains above key levels, with its periods of growth coinciding with phases of active price increases. Despite intraday or weekly fluctuations, the current values of the metric still indicate that the market remains in a “bullish” phase. Moreover, a combination of fundamental factors provides additional support for the price. Thus, even during temporary pullbacks, the market structure reflected by aMVRV remains favorable for long-term holders and participants expecting the continuation of the upward trend.

Both of these metrics are related to the ratio of market capitalization to realized capitalization, but they view it from different angles:

Bitcoin: Growth Rate (Market Cap vs. Realized Cap) 365DMA focuses on the rate of change (or the dynamics) between market capitalization and realized capitalization over a 365-day moving period. In simple terms, it indicates how quickly and in which direction the gap between the cost basis of coins (Realized Cap) and the current market valuation (Market Cap) is changing.

Bitcoin: Adjusted MVRV (30DMA/365DMA) is essentially the classic MVRV – the ratio of market capitalization to realized capitalization (Market Cap / Realized Cap). The comparison between the 30-day and 365-day moving averages reflects how the short-term dynamics of MVRV relate to the long-term. Thus, the Growth Rate focuses on the speed/dynamics of the changes between Market Cap and Realized Cap (essentially the “slope”), while MVRV is a static ratio (albeit smoothed over different periods). They often correlate but are not the same metric.

Bitcoin: Exchange Flow Multiple (30D/365D)

The Bitcoin: Exchange Flow Multiple (30D/365D) metric reflects the ratio of the short-term volume of Bitcoin flows (both inbound and outbound) on exchanges to their long-term average. If this ratio declines, it means that over the past 30 days, the activity on exchanges – whether sales or purchases – has decreased relative to the 365-day average. Such a slowdown in exchange flows often indicates that investors are moving less BTC onto exchanges for selling and/or are withdrawing less frequently in anticipation of high-volatility moves.

A reduction in exchange activity may indicate that short-term speculators have either already taken profits (or losses) or have adopted a wait-and-see stance, while long-term holders prefer not to part with their coins. This creates a tighter supply in the market and is generally considered a bullish signal: with low liquidity on exchanges, even relatively modest demand can drive the price up, and the absence of mass sell-offs reduces the risk of sharp declines.

Bitcoin: Coin Days Destroyed, Old Long-Term Holder Activity

The Coin Days Destroyed metric reflects the activity of Bitcoin holders, taking into account the “age” of coins being moved: the longer coins remain dormant, the more “days” they accumulate, and the higher the value when they are moved or “destroyed.” When we examine the monthly changes of this metric, we are interested in how frequently and in what volume coins belonging to long-term holders are being moved. Sharp spikes usually signal that older coins are actively being transferred or sold, while low values indicate a lack of significant activity among long-term investors.

A decline or consistently low level of Coin Days Destroyed on a monthly basis may suggest that long-term holders (older coins) are not in a hurry to sell and prefer to maintain their positions. This is typically interpreted as a sign of confidence in further growth or at least in market stability. Conversely, a noticeable increase in this metric may indicate that older coins are coming into circulation – for instance, to take profits or rebalance, which is often accompanied by increased price volatility.

Conclusion

The Bitcoin market remains in a phase of moderate growth despite short-term negative factors such as the Bybit exchange hack. Fundamental indicators, including high institutional interest, the emergence of new ETFs, and a relatively stable network hashrate, continue to support a bullish sentiment, while declining exchange flows and low Coin Days Destroyed levels indicate that long-term holders are reluctant to part with their coins.

Moreover, overall macroeconomic uncertainty (declining stock indices, expectations for monetary easing, geopolitical risks) may stimulate a capital inflow into Bitcoin as an alternative asset. As a result, even amidst local pullbacks, the long-term market structure appears resilient, and key on-chain metrics signal the potential for further growth.

Forecast

Target Price: $130,000

Projected Total Return: 34.74%

Investment Recommendations: 🟢 Outperform/Accumulate

For more details on the rating, please refer to this link.

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Good luck in the upcoming trading week!

AAJ

Disclaimer:

This material has been prepared solely for informational purposes and does not constitute an offer, recommendation, or solicitation to buy or sell any securities, digital assets, or other financial instruments. The information presented in this report is considered reliable; however, its accuracy or completeness is not guaranteed. Past performance is not indicative of future results. Any investment decisions are made by the investor independently, taking into account personal financial circumstances and, if necessary, after consultation with a qualified professional. The author and affiliated parties may hold positions in the assets mentioned in this report. The author and publisher accept no responsibility for any direct or indirect losses arising from the use of this information.

Risks:

High volatility may lead to sharp fluctuations in value, adversely affecting investors' portfolios. Significant price swings may reduce the attractiveness of BTC to institutional investors, especially in the derivatives segment (futures, options). Potential tightening of regulatory requirements by governments and central banks may restrict access to BTC markets and reduce liquidity. Issues with custodial services, centralized exchanges, and hacking incidents could undermine confidence in the asset and negatively impact liquidity.