Investors, traders and digital assets linked firms are gearing up for the much anticipated Bitcoin halving event. Data shows that BTC withdrawals from exchanges have reached their highest level recorded since January 2023. This signals a high accumulation phase, while, Bitcoin price has dropped by over 8% in the last 7 days.
Crypto market crash over?
As per the key details shared by Cryptoquant, despite recent market volatility and a 10% decline over the last week, various metrics that suggest a cooled off market ahead. CryptoOnchain reports a surge in Bitcoin withdrawals. This is typically linked with increased holding in anticipation of future price rises. It usually happens around halving events.
The global digital assets market recorded a marginal recovery on Wednesday when the investors were hoping for a rebound. This comes following a 10% decline recorded last week. The Open interest (OI) on derivatives exchanges dropped from $18 billion to $14.2 billion. It directly indicates reduced leveraged trading and temporary market stabilization.
As the market prints green indexes, Bitcoin has entered the support zone in the Short term holder spent Output Profit Ratio (STH SOPR). Now, this suggests a buying opportunity as short term holders begin to sell off.
Pre Bitcoin halving effect?
With the fourth Bitcoin halving approaching, the recent price drop of 16% is seen as normal. However, it is expected to happen before each halving cycle. Last BTC halvings have also seen similar price drops followed by high surges. The upcoming halving event, expected to occur with the generation of block no. 840,000 on the Bitcoin blockchain, is in focus.
At the time of the second Halving, BTC Price dropped by 40.36% before soaring to a peak of $19,600. The same happened at the Third Halving event. Bitcoin price decreased by 20.35% before climbing to a peak of $69,000.
The current price decrease stands at 16%. The experts state that there’s no need for alarm as this pattern is consistent with previous cycles. The market remains open for potential growth.
Bitcoin’s marginal rise on Wednesday was influenced by emerging risk sentiment due to higher US interest rates. The dollar’s strength, coupled with persistent geopolitical tensions in the Middle East, has kept traders cautious.
Bitcoin price jumped by around 2.9% in the past 24 hours to trade at $64,269.5. It has remained within a trading range of $60,000 and $70,000 for the past month.
