Bitcoin continues to show resilience, holding above crucial demand levels after its recent decline from all-time highs. While the market is facing negative sentiment and a wave of bearish expectations, Bitcoin price action remains steady, providing hope for investors looking forward to a potential recovery.
To add to Bitcoin’s strength, CryptoQuant’s CEO recently shared compelling data combining off-chain and on-chain metrics. The analysis reveals that the estimated capital stored on the Bitcoin network has risen to $1.03 trillion. This significant increase confirms Bitcoin’s characterization as a powerful store of value, in line with the thesis supported by many analysts regarding the leading cryptocurrency.
As macroeconomic uncertainty emerges, Bitcoin’s ability to maintain its position above critical levels provides a sense of stability to an otherwise volatile market. Investors and traders are closely watching whether this new support will translate into a rally or whether broader market forces will weigh on BTC further. For now, the data suggests that Bitcoin’s foundation remains strong, fueling continued confidence in its long-term potential as a digital store of value.
The capital stored on the Bitcoin network is growing
Bitcoin has had an amazing year in 2024, with its performance reflected not only in rising prices, but also in key metrics indicating the network’s growing strength. As the year comes to a close, data suggests that Bitcoin’s role as a store of value (SoV) is clearer than ever.
CryptoQuant CEO Ki Young Joo recently Share valuable insights about XHe revealed that by combining off-chain and on-chain data, the estimated capital stored on the Bitcoin network reached $1.03 trillion, an 85% increase from the previous year.
This growth supports the idea that Bitcoin is increasingly viewed as a long-term store of wealth, beyond mere speculation. It’s not just about market capitalization, which currently stands at $2 trillion, explains Joe. Adding $1 to BTC does not directly translate to a $1 increase in its market value. Instead, we can estimate capital flow through a combination of off-chain and on-chain data.
First, off-chain exchange transactions are taken into account, where exchange reserves are multiplied by the volume-weighted average price (VWAP) to estimate the capital entering the market via exchanges. Second, on-chain data is used, especially OTC and exchange deposits/withdrawals. Bitcoin is executed and settled simultaneously, and capital flows can be tracked through the realized cap, which monitors the cost basis of BTC movements on the blockchain.
By combining these metrics, we arrive at the SoV Index, a tool that captures the real capital flowing into the Bitcoin network. This provides a clearer picture of Bitcoin’s value and its growing status as a global store of value, with data supporting its fundamental strength through 2025.
BTC is ranging between crucial levels
Bitcoin is currently trading at $93,600 after facing several days of selling pressure and fear in the market. The price reached a high of $99,880 last Thursday, but has since fallen more than 6%. This recent decline has raised concerns about Bitcoin’s immediate price action, but the key levels to watch are clear.
If BTC can break above the $100k mark and hold it as support, it will signal bullish confirmation, which could pave the way for a new price high. This level has psychological importance and will reinforce the uptrend if it continues.
On the other hand, if the bulls lose the critical support range of $92,000 to $90,000, the market could see a deeper correction. A move below this support is likely to lead to further selling, possibly testing lower levels in the near future.
These levels are likely to determine Bitcoin’s short-term direction. As the market continues to react to external factors, monitoring these key areas will be essential to understanding Bitcoin’s next direction.
Featured image by Dall-E, chart from TradingView
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