Willy Wu, a Bitcoin (BTC) analyst and co-founder of software company Hypersheet, believes the on-chain calculations show that BTC is not in a bear market despite noticing “peak fear” levels.
Speaking about the What Bitcoin Did podcast hosted by Peter McCormack on Sunday, Wu cited the large number of long-term coin holders (conservatives for five months or more) and rising savings rates as key figures, indicating that the market has not changed. haul land:
“Structural on the chain, this is not a bear market setup. Although I would say that we are at the peak of fear. There is no doubt about it, people are really scared and there is usually […] an opportunity to buy.”
In the short term, Wu noted that “it’s not often that withdrawals without setbacks” and that a potential capitulation of up to $20,000 is not an option as it will collapse again in 2018’s bear market in just three months. up to a year.
Bitcoin is down about 44% from its November high of $69,000, with the analyst citing institutional futures trading as the main reason for this sustained decline and solid performance over the past three months.
Wu suggested that the increase in the influx of large traders and the opening of BTC futures markets in recent years has drastically changed the structure of the BTC market, since the price is directly related to “risk taking by large traders considering traditional stocks.”
“You know, back in 2019-2020, if you look down the chain, what investors were doing, they were piling up, but you couldn’t see any price impact because the price was really being set by the traders on the futures exchanges,” he said.
The analyst cited a large number of long-term scammers who have not sold for more than five months and traders who have stopped selling around $40,000 as well as a fixed rate of accumulation as the main reasons for optimism, the analyst cited.
Related: Bitcoin closes at $40k but professional traders still skeptical
“Most of the coins are there for more than five months, and those who do, keep them for five months, they don’t sell at a loss, they sell when there is a profit, and you will see when it breaks. through all-time highs and making a very strong rally.”
He also argued that a leading indicator in bear markets usually shows up when “beginners” or new currency traders are in the majority:
“The bear was on the rise in 2018, the new boys are holding the coins, and the cycle is repeating. These guys are selling or those who don’t become big scammers and sell on the next rally when it’s still up.”