Along with BTC ETF earnings, Bitcoin traders are returning to profits despite falling prices
Bitcoin (BTC) prices have faced increasing demand-side pressure, rallying more than 23% in the past two weeks, to hit a 2-month high of $68,583 on July 22. According to market intelligence firm Glassnode, Holdings ( STH )'s spending base highlighted the “current strength of growth.”
The BTC price above $68,000 “has been a welcome relief for Bitcoin short-term holders (STHs),” Glassnode wrote in its July 24 “Week On-Chain” newsletter.
According to the onchain data provider, more than 90% of this group of investors “lost their supply” after the July 5th low of $53,500, putting them in financial trouble.
“This rally has now moved back above STH's cost basis and returned 75% of their supply for a failed profit. This can be seen in the STH-MVRV index, which has now recovered above the 1.0 breakout level.”
Bitcoin's STH cost basis – or guaranteed value – is a measure that represents the average purchase price of Bitcoin for investors considered short-term holders, as defined by the movement of coins held for less than 155 days.
According to data from LookIntoBitcoin, BTC breached the $68,000 level on July 22, rising above the STH price at the time, which was $65,329.
Additionally, the recent recovery has pulled the MVRV of all STH groups above 1, which shows how their profitability has changed over recent buying groups.
“Currently, all components of the short-term portfolio have returned to positive returns, indicating the strength of the turnaround. This could be positive for overall investor sentiment.”
“The MVRV ratio shows that the price of Bitcoin is managed to stay above the average cost base of short-term holders,” declared Crazyblockk, an anonymous analyst at CryptoQuant.
Crazzyblockk stated that the MVRV ratio is an important metric in Bitcoin analysis, and its return above the STH cost base is important to maintain optimism and encourage new capital flows into the market.
“Historical #Bitcoin price cycles, based on the logic of owner behavior, highlight the importance of price stability and cost averaging for short-term investors.”
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Spot Bitcoin ETF flows turn negative.
On July 23, US-based spot Bitcoin exchange-traded funds (ETFs) saw outflows totaling $77.92 million, ending a twelve-day streak of outflows.
Data from SoSo Value shows that on July 23, Bitwise's ETF BIBT posted a net inflow of $70.3 million, followed by 21Share's Bitcoin ETF ARKB with a net inflow of $52.3 million and Grayscale ETF GBTC in third place with a net inflow of $27.3 million.
On the other hand, BlackRock's ETF IBIT was the only fund with inflows of $71.9 million, while the rest of the ETFs saw no inflows.
Since July 23, the 10 Bitcoin funds that began trading on January 11 have seen net inflows of $17.5 billion, with more than $59.97 billion in assets under management.
Bitcoin ETFs' inflows over the past two weeks are the highest since May, posting more than $4 billion in inflows between May 13 and June 7.
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
