In present times, Bitcoin has shown enhancing price performance pushing the levels past $30,000 marking an almost 80% gain over the year to date. However, strategists from Bank of America observed data and suggested there still is more growth to come.
According to Alkesh Shah and Andrew Moss, strategists for Bank of America Corporation, a net $368 million of Bitcoin was sent to personal wallets in the week through April 4. Notably, this is the period that witnessed this year’s second-largest net Bitcoin outflow from crypto exchanges.
In addition, the financial strategists explained that the trend of moving tokens from crypto platforms to their personal wallets typically means that investors are looking to hold them suggesting a waning selling pressure. Quoting them:
Investors transfer tokens from exchange wallets to their personal wallets when they intend to hold them (or HODL), indicating a potential decrease in sell pressure.
The duo also addressed the role that the US regulatory scenario might have had in the outflow of Bitcoin. They said that concerns regarding the US regulatory crackdown on crypto exchanges may have contributed to the outflow. As the major crypto companies in the US, including Coinbase and Binance, are facing major scrutiny from regulators.
The latest surge in Bitcoin prices has again sparked conversation around the asset’s potential as a store of value. Analysts previously undermined the asset’s resilience while highlighting that it has weathered two previous “winters” before the 2022 downturn. The turnaround in each case yielded exponential returns.
As the outflows increased indicating the investors’ intention to hold the asset, data from Glassnode also supports it. Data suggested that the majority of Bitcoin holders are not willing to sell their assets at the moment and are inactive.
The inactivity or dormancy here represents that the coins have not shown any movement for the past two years. In particular, the percentage of supply last active more than two years ago has hit an all-time high of 53%.
About 69% of Bitcoin holders are long-term holders who have held the cryptocurrency for more than one year whereas only 23% of holders have held it between one and 12 months, and 8% of addresses hold it for less than one month.
In addition, the world’s largest cryptocurrency by market capitalization has surpassed major asset classes in an impressive turnaround from the market-wide rout just a year ago. Todayq News reported that Bitcoin has emerged as the top-performing asset class in the first quarter of 2023, with gains of about 70%.
This marks Bitcoin’s best quarter since the first quarter of 2021, with the asset’s latest quarterly returns placing it ahead of big names such as the S&P 500, Nasdaq 100, and iShares Core U.S. Aggregate Bond ETF.
As the present time looks out to be good for the asset, analysts have expected more highs to be seen in the coming times. At the time of writing, Bitcoin is changing hands at $30,093.40, marking a 7% increase over the past five days, and about a 24% increase over the past month.