Due to the recent increase in market volatility, discussions about another major rally in Bitcoin in this cycle have increased significantly in the space. However, market experts suggest that BTC’s next bull run could be around the corner, driven by multiple key factors including institutional interest and growing on-chain activity.
Is Bitcoin gearing up for another bull run?
Despite the ongoing market decline, recent technical indicators suggest that Bitcoin’s price could be on the verge of a major breakout, as cited by on-chain expert Tarekonchain in a recent study on the CryptoQuant platform.
In his research, Tarekonchain highlighted several recent developments surrounding the flagship crypto asset that could serve as catalysts for the expected bullish surge in the coming months. The first development the on-chain analyst pointed out was the decline in Bitcoin exchange reserves.
According to data from Tarekonchain, exchanges’ BTC reserves have been steadily declining, a trend that often precedes price increases. This decline suggests that investors are storing their BTC in cold storage, reducing the available amount. Given that price spikes have usually followed such moves in the past, analysts believe a similar situation may be occurring currently.
Another indicator highlighted by Tarekonchain is the significant increase in stablecoin reserves on exchanges, while BTC’s exchange reserves have fallen, meaning that investors are preparing to buy more BTC.
It is worth noting that the prevalence of stablecoins represents readily deployable capital, which suggests that traders may be waiting for the right time to enter the market. Therefore, this increase in exchange stablecoin reserves indicates high buying interest.
Supply-demand mismatch could spark a breakout
Finally, experts pointed out that the market structure is bullish due to the decrease in BTC reserves and the increase in stablecoin reserves, laying the foundation for a bullish breakout in prices in the near term.
Tarekonchain believes that the market is ready for a possible bullish breakout because there are now fewer Bitcoins and the purchasing power is rising, which shows that the imbalance between supply and demand has led to significant price increases in the past.
So far, experts have urged investors to remain patient and watch for a possible price breakout in the coming weeks. "We could be on the brink of higher prices as market supply tightens and purchasing power strengthens," he added.
At the time of writing, BTC is showing a healthy performance, up more than 2% in the past 24 hours and trading at $58,045. Bulls appear to be betting on the digital asset as of late, as its market cap and trading volume have increased by 2.51% and 18% respectively over the past day.
That’s all for today’s article. We are currently in a bull market, and things are turbulent. We share passwords every day.
