Bitcoin short-term holders in profit as the ratio reaches to two-year high
Bitcoin (BTC) rose from $16,500 to the current price of $21,130 in the first 17 days of 2023. While investors might be excited about the recent bullish momentum, the on-chain intelligence platform Santiment expects a “short-term price reversion.”
Per Santiment, as the macroeconomic situation still shows signs of fluctuation, investors must be cautious about cryptocurrencies since the asset class is liquidity-driven.
“I would be cautious with how far we get before the macroeconomic environment state settles itself.”
NeuroInvest, Santiment analyst
The analyst states that the short-term altcoin rally has been showing signs of overheating while the long-term holders are still sticking to their assets.
Moreover, Santiment data suggests that the profit ratio for the flagship cryptocurrency, bitcoin, reached an almost two-year high level of 1.09 — which was previously noticed in February 2021. For the second-largest digital currency, ethereum (ETH), the numbers reached a 15-month high of 1.34 — which was seen in October 2021.
Santiment believes traders are taking this opportunity to profit while given a chance.
The on-chain analytics provider CryptoQuant is also expecting a bear trend as the BTC reserves on spot exchanges saw a rally. Data shows investors have been transferring their assets from cold wallets to spot exchanges for profit taking.
As the selling pressure is hiking, the stablecoin reserves show signs of a drop, per CryptoQuant data. This movement could mean a short-lived recovery rally since more demand is needed for the rally to be sustainable.
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