"This isn't a speculative rally this time"...Bitcoin, spot buying explodes

▲ Bitcoin (BTC)

An analysis has emerged suggesting that Bitcoin (BTC) is rebounding based on strong spot demand rather than speculative buying. As price movements across risk assets increased amidst the digestion of US economic indicators, Bitfinex assessed that the recent Bitcoin breakthrough reflects a recovery in spot buying and structural improvement.

CryptoPotato reported on the 12th, citing the Bitfinex Alpha report, that the Bitcoin rally occurred amidst a widening divergence between past US economic indicators and deteriorating consumer sentiment. Bitfinex analyzed that this macro environment is influencing risk assets like Bitcoin, driving price increases.

Bitcoin has risen 12% since early April, marking its strongest monthly performance in the past year, and the total cryptocurrency market capitalization has increased by $200 billion. Bitcoin surpassed $80,000 for the first time since January 31st, breaking through a thick resistance zone formed between $78,000 and $79,000. During the rally, it approached $83,000 and recovered near the key average acquisition cost zone of $79,800.

Bitfinex analysts explained that this movement demonstrates Bitcoin's structural improvement. They particularly noted that Bitcoin surpassed the key aggregated cost basis of around $79,800. This price level was also presented as the 'True Market Mean,' and Bitcoin reclaiming it was interpreted as a signal of market recovery.

The core of this rally was aggressive spot demand. According to on-chain data, the Spot Cumulative Volume Delta (CVD) has risen sharply since May 8th. This was presented as meaning that buyers absorbed selling pressure even at higher price levels. Order book flows also shifted from a buyer-dominant structure to a more neutral form, and spot demand was analyzed to have come from exchange-traded funds (ETFs) and open market accumulation.

However, Strategy's Bitcoin buying momentum was noted to have weakened compared to before. Strategy's purchases are linked to STRC, an income-generating product, but STRC could not trade above its $100 par value, which is the threshold required for additional Bitcoin purchases. CryptoPotato reported that the company is even considering selling some Bitcoin.

Nevertheless, 'conviction buyers' with a strong long-term holding tendency are increasing their Bitcoin holdings. These entities are described as accumulating Bitcoin regardless of price fluctuations and rarely selling, and they currently hold approximately 4 million BTC. Bitfinex analyzed that the increase in holdings by this group is the largest since the COVID-19 crash, and historically, such trends often preceded major price recoveries.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*