Bitcoin's Bullish Signals: These 3 Key Metrics Indicate Potential Upswing, Says Research Firm

Market intelligence firm Santiment has identified three key metrics suggesting a potential bullish move for Bitcoin BTC/USD.

What Happened: The analytics platform highlights that the average returns of wallets, the dormancy period of coins, and Bitcoin’s supply on exchanges all indicate a possible upward swing for the leading cryptocurrency by market cap.

Santiment notes that historically, accumulating BTC when wallets’ average returns are below 0% has proven to be a strong strategy. Currently, wallets active in the past 30 days show average returns of approximately -2.9%.

This suggests that buying or adding to positions could be statistically advantageous.

Additionally, older BTC tokens are circulating at a “healthy rate,” which is often a precursor to a rally. Santiment explains that when dormant tokens move frequently, it signals a healthy circulation, typically seen during prolonged bull runs.

Finally, Santiment points out that the amount of BTC on exchanges remains low after a significant withdrawal of coins into cold wallets in late 2024.

Currently, 7.6% of Bitcoin is held in known exchange wallets, compared to 9.92% six months ago.

Why It Matters: The potential bullish signals for Bitcoin come amid broader discussions about its role in economic strategies. Michael Saylor, a prominent Bitcoin advocate, recently called on the U.S. government to accumulate Bitcoin, suggesting it could serve as “economic armor” and help eliminate national debt.

This perspective aligns with Matthew Sigel’s vision of using Bitcoin as a strategic reserve to offset the national debt by 2049.

However, not all outlooks are positive. JPMorgan analysts have expressed concerns over declining institutional demand for Bitcoin and Ethereum futures, which could signal broader market weakness.

This decline in demand has been associated with futures contracts nearing backwardation, a condition where futures prices fall below spot prices, often seen during market downturns.

Price Action: Bitcoin was trading at $96,204 at the time of writing, declining by nearly 2% in the last 24 hours, according to Benzinga Pro data.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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