Glassnode pointed to positive shifts in the fundamental metrics of bitcoinMathew Chavez
In the context of a decrease in activity in the bitcoin derivatives market, constructive medium-term and long-term trends are being formed. These are the conclusions made by Glassnode analysts.
Over the last five years, #Bitcoin derivatives have expanded and matured significantly.
Perpetual swap futures have emerged as the industries preferred instrument for trading and price discovery.
Read our analysis on the dominance of perpetual swaps👇https://t.co/rVL5jAUnTJ
— glassnode (@glassnode) April 25, 2022
Over the past 12 months, trading volumes, implied volatility and spreads to the spot market have fallen to all-time lows. This was facilitated by price consolidation since mid-January.
The funding rate for perpetual contracts began to contrast sharply with the previous months, which were characterized by periods of active build-up of longs and shorts.
In terms of annual rates, the funding rate, as well as the cost rolling in the next quarterly futures for market makers began to look unattractive. Experts believe that such market conditions create prerequisites for the flow of capital into segments with a different risk and return profile, especially given the jump in annual inflation to 8.5% in the US.
There is also a decrease in network activity. On-chain value transferred per day fluctuates in the range of $5.5 billion-$7 billion, which is 40% lower than the peak during the bull market, although higher than the values observed in 2019-2020.
The experts emphasized that since October 2020, the share of transactions worth the equivalent of $10 million and more has increased from 10% to 40%. Experts explained this by the growing influence of trading decisions of institutional and wealthy individuals.
Another positive factor in terms of medium-term prospects is the cyclical discrepancy between the volume of inflows / outflows associated with cryptocurrency exchanges and the total volume of transactions. Currently, the figure has dropped to 32%.
For analysts, this is evidence of a transition from speculation to fundamental demand-driven actions like over-the-counter transactions, the accumulation of coins by hodlers, and custodian operations.
Recall that on April 25, quotes of the first cryptocurrency updated the local minimum below $38,500.
BitMEX co-founder Arthur Hayes named the likely fall of digital gold to $30,000 by the end of the second quarter of 2022 due to the decline in the Nasdaq index.
Formerly Glassnode analysts declared the end of the process redistribution of coins from speculative investors to hodlers and allowed bitcoin to bottom.