The prevailing bear market saw Bitcoin touching monthly lows at $37,614 after the leading crypto breached its $38,000 short-term support barrier. Glassnode, a blockchain data provider, stated that holding tokens in long timeframes without quick significant returns might trigger the largest capitulation move never witnessed in Bitcoin’s history.
Nevertheless, it isn’t the first time BTC would experience a market capitulation. The bellwether crypto has seen these events in 2016 and 20 following massive fluctuations that dominated for about 100 weeks.
Bitcoin at the Moment
While publishing this content, Bitcoin traded in red, hovering at $38,410. Meanwhile, the Relative Strength Index continued with its multiple attempts to hit the neutral level but escaping the 40-mark seems challenging for the indicator.
Evaluating Bitcoin’s price actions within the past four months (up to May 2) showed the MVRV (Market Value to Realized Value) ratio of 1.57. That adds credence to the narrative that Bitcoin holders are at losses with the current price.
The May 2 trading session also saw active addresses surging compared to the day before (May 1). This metric increased to 975,505 from 833,480, adding weight to the narrative highlighted above.
Can BTC Avoid the Capitulation
Wu blockchain shows BTC mining difficulty raised. The mining difficulty rate saw a 5.53% uptick to 29.79 T from 28.22 T, as the current hash rate stood at 222 EH/s. Remember, an increased hash rate shows more individuals joining the platform to mine tokens, improving the asset’s security. Nevertheless, the MVRV stats plus BTC’s current price outlook shows higher market capitulation chances.
Meanwhile, tweets shared by individuals show Twitter users could be waiting for the market capitulation. PlanB posted how the market remained highly sluggish despite BTC completing the whole bear and bull market cycle. Considering the market reactions within the past couple of days show BTC taking the narrative that anything capable of going wrong will do at its worst possible time.
However, crypto market analyses are hardly 100% accurate. Also, BTC saw capitulation before and recovered. We may continue watching current trends for upcoming broad market directions.
What are your thoughts about market capitulation in BTC? Share your views in the comment area below.