Is it the right time to scoop up Bitcoin? A new BTC cycle begins

Bitcoin on-chain data over the last 90 days shows bullish signals. Bitcoin holders selling over the past three months have been at a consistent profit, while demand for BTC among institutions and retail investors has increased steadily. 

The market points at the end of a Bitcoin bear market and a new cycle with bullish potential for BTC price. 

Also read: Why the demand for Ethereum is high despite rising gas fees, is it time to buy?

Bitcoin demand among retail and institutional investors climbs

Bitcoin addresses holding 0.1 BTC or less grew slowly in 2022, but 2023 shows the return of trader optimism. The BTC network added 620,000 small Bitcoin addresses since the FOMO returned on January 13 when the price hit the $20,000 level. 

Crypto intelligence tracker Santiment marked the return of small investors to Bitcoin in the chart below:

Bitcoin addresses pop-up rapidly on the blockchain 

Interestingly, retail investors' enthusiasm is shared by institutional investors over the past week. $117 million headed into crypto investment products in a single week, with a large chunk of capital going straight into Bitcoin. 

According to a CoinShares report, Bitcoin took home the lion’s share of investment with $115.6 million flowing into BTC. The return of institutional investors’ enthusiasm is matched with on-chain metrics that flipped bullish recently. 

Bitcoin on-chain metrics signal further bullish potential in BTC

On-chain metric Bitcoin Realised HODL (RHODL) Multiple noted an upswing and has been in a sustained uptrend throughout the past 90 days. This indicator identifies whether Bitcoin holders selling during a fixed period of time are selling at a profit or loss. 

RHODL Multiple has flipped bullish with sellers during the past three months selling at a consistent profit. This demonstrates there is an uptick in demand by new investors in BTC. 

Bitcoin RHODL Ratio 

Bitcoin Supply in Profit is a metric that tracks the “paper profit” or unrealized profit of BTC that last moved when USD-denominated prices were lower than they are right now. This on-chain indicator shows that BTC supply in profit has climbed over the last 30 days. 

The Supply in Profit indicator has increased by over 20 percent since the beginning of 2023. This implies that larger and longer-term investors currently hold profitable on-paper spot positions. 

BTC Supply in Profit

This is healthy for the latter half of a bear market as a sustained 30-day uptrend after a prolonged downtrend on this indicator has historically provided a good buy signal for the following two years.

Based on on-chain indicators and rising demand among both institutions and retail investors, it is a good time to buy Bitcoin at the end of the bear market.