A few weeks ago, a sharp decline toward $60,000 happened in Bitcoin, and many analysts marked this as possibly the end of hope for a bull run in 2024. Well, a few weeks later, Donald Trump became the U.S. president again, and Bitcoin somehow did a bizarre +40% rally within a week.
The sentiment has changed, and the market dynamics have shifted. Bitcoin single-handedly outperformed the median average of any crypto category this month, and after +1000% and +5000% rallies on unfamiliar altcoins, Bitcoin still outperformed everyone in just a single week.
Now, as we hit euphoria and Bitcoin gives the elixir of life to investors, there's a certain buzz about Bitcoin price prediction and how much it'll score before 2025. Let's go…
The coinbase Premium Index
The Coinbase Premium Index represents the price difference of Bitcoin on Coinbase compared to other exchanges, with a positive premium indicating stronger buying activity on Coinbase, which often reflects demand from U.S. institutional investors, as Coinbase serves a large U.S.-based user base.
Looking at the data, we can see fluctuations in the premium index, with multiple points dipping below zero. This indicates that Bitcoin was trading at a slight discount on Coinbase relative to other exchanges during these periods, possibly due to lower buying activity or some selling from U.S. traders. However, in early November, there’s a noticeable shift as the premium index climbs into positive territory. This rise aligns with Bitcoin’s price moving toward $82.1K, which may indicate renewed buying interest on Coinbase, likely from institutional or larger U.S. investors.
The correlation between this positive premium and Bitcoin’s price increase in November reflects stronger demand among U.S.-based investors, who appear willing to pay slightly more on Coinbase than on other platforms. This growing premium aligns with bullish sentiment in the U.S. market, as we can see U.S. investors actively contributing to the price rally, signaling increased interest in Bitcoin at this time.
Puell Multiple
Finally, the Puell Multiple is a ratio of the daily Bitcoin mining revenue in USD (also known as daily coin issuance) to the 365-day average mining revenue.
At press time, the 30-day SMA of the metric was at 0.7, with the previous cycle top being at 2.98.
The consolidation of the past six months gave the metrics and the price action a chance to recuperate on the higher timeframes. Heightened demand, especially once the asset breaks its previous ATH and draws more eyes, could hasten gains.
Cumulative Return on Halving Years
Bitcoin’s performance in different halving years, comparing data from 2020 and 2024. By setting the start of each year at an index of 1, the chart shows how Bitcoin’s returns have grown over time following each halving. At first, both 2020 (in purple) and 2024 (in blue) display similar trends, with steady, if somewhat bumpy, growth in the first and second quarters. This pattern aligns with what we often see after a halving event, as excitement typically builds around Bitcoin, and the slower supply increase tends to support prices.
The real difference shows up in the fourth quarter, where 2024’s returns start to look much stronger than 2020’s. By year-end, 2024’s index nearly reaches 4, indicating a fourfold increase since the beginning of the year, whereas 2020’s gains aren’t as high. This surge in 2024 might be due to factors like more interest from institutional investors or broader economic conditions that are making Bitcoin a more appealing investment.
For investors, 2024 is looking like an especially promising year in Bitcoin’s post-halving cycle, with the potential for higher returns than we saw after the 2020 halving.
Exchange Net Position
The balance on exchanges reflects the total amount of Bitcoin held across all exchange wallets, and this metric often indicates investor sentiment. When Bitcoin balances on exchanges decrease, it suggests that investors are moving their holdings off exchanges, likely into private wallets, which is usually a sign of long-term holding intentions. Conversely, an increase in exchange balances may signal that investors are preparing to sell or trade.
Looking at the data, we observe a gradual decline in the Bitcoin balance on exchanges throughout October, suggesting a trend toward holding rather than selling. This trend shifts in early November, where there’s a steep drop in exchange balances around the 7th to 9th of November. This sharp decrease coincides with an uptick in Bitcoin’s price, which moves upward in the same timeframe. This pattern implies that investors may be moving Bitcoin off exchanges in anticipation of a price increase or as a sign of confidence in long-term growth.
The sudden drop in Bitcoin balances on exchanges around early November, alongside the price increase, reflects a bullish sentiment among investors.
ETF Inflows & Quarterly Return
The October-end data from Farside confirms that Bitcoin ETFs saw significant inflows, and after hitting an all-time high of $90,000, the ETF market is fully green, with big investors looking for more upside potential.
Beating the March $BTC rally, the Bitcoin ETF has hit an all-time high in inflows, surpassing $1 billion USD. This is very bullish, of course, as ETFs are a major milestone for institutional investment in the U.S.
Historically, Bitcoin's Q4 returns have been notably high, with an average of +82.59%, often marking a bullish trend toward the year's end. Years like 2013 (+479.59%), 2017 (+215.07%), and 2020 (+168.02%) saw significant spikes, frequently coinciding with the peaks of bull markets. This trend suggests heightened investor interest and demand in Q4, making it a critical period for Bitcoin's annual performance.
This year, it might end with a stronger performance than the previous bull run, with circumstances strongly favoring a Bitcoin rally. It's likely $BTC will once again outperform the market.
🎟️ Some Goodreads
> How To Buy Best Coins During Dumps
> Dark Skippy Can Steal Your Bitcoin Even From Hardware Wallet
> The Decentralized AI landscape
▶️ Data Credit
> Cryptoquant
> Coinglass
> Farside
> The Block
> beINcrypto
🅃🄴🄲🄷🄰🄽🄳🅃🄸🄿🅂123
