Bitcoin is still dominant in the crypto market. In the past year, there have been considerable returns, increased adoption of the non-fungible tokens (NFTs), and a rapidly developing crypto sector. All these factors indicate that Bitcoin (BTC) might be ready for a massive market cycle to happen.
One popular crypto trader Michaël van de Poppe said that the market is nearing the last phase of the cycle now because it has seen massive gains and increased retail and institutional adoption. He stated:
“We’ve seen platforms accelerating, we’ve seen the rise of NFTs, and we’ve seen the ecosystem grow even more, which means that the adoption is growing heavily to and that is something that goes exponential. So the actual big gains or most of the gains are made at the last part of the cycle.”
Bitcoin Is Now In A Similar Stage To The Dot-Com Bubble
Poppe said that the market is witnessing the fundamental adoption that is analogous to the dot-com bubble. Not just through different countries but also via individuals who are looking for a better annual percentage rate (APR) via decentralized finance or just by using a transfer or cryptocurrency to move their funds from one nation to the next.
The second reason he said is that institutional investors are developing various financial instruments to establish themselves in the markets. Furthermore, there are major levels of inflation that can only be resolved by investing in crypto to act as a hedge. He stated:
“The fact that institutions are creating financial instruments to actually bring itself into the markets and then we still overall have that inflation discussion topic in which crypto is one of the best assets to jump into.”
Investors Make Profits In The Final Phase Of The Cycle
The trader mentioned that “in a true run of the markets, the actual money is made in the last part of the cycle.” About that matter, he identified major on-chain metrics that show that Bitcoin is still in an interesting zone of market development. He highlighted:
“The MVRV [Market Value to Realized Value] ratio is currently showing that we’re now nowhere near an overvaluation, and it’s showing that the previous run to $69,000 didn’t even show Bitcoin hype in euphoria which was the case in the first run in which we saw the hype accelerate quite fast and overall media attention started to grow.”
He also stated:
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“But the indications of the MVRV feed ratio show that we are currently just acting at the lower bounds instead of at, the higher bounds so this is another conclusion or confirmation that we are getting at the interesting zones.”
Long-Term Holder Supply Is A Critical Indicator
In the end, Poppe analyzed why the value of BTC is relatively low when compared to the real valuation at this stage. The crypto analyst insisted that the long-term holder supply integrates with the fact that Bitcoin is currently at a low valuation since the long-term holders are growing their positions gradually as the market is surging once more.
“With the long-term holder supply, the moment that we get into a hyped version or that we start to accelerate quite fast, you can see that all those indicators are getting into hype territory. Sentiment overall becomes bullish, and then the long-term holders are starting to sell off.”
That he insisted is the period he said that traders need to be looking to begin minimizing their positions or start to think about doing it as highlighted by Finbold. Eventually, he considers Bitcoin to be ready for a huge bull run and that one needs to be looking for longs instead of shorts when trading the coin.