Bitcoin On-Chain Demands Suggests That The Market Has Reached Its Bottom

Bitcoin on-chain analysis can be a good way to try to guess where the market is headed. The market tends to repeat itself with metrics looking the same before a bull or a bear rally, thus making this data a pretty good indicator of what’s to come. Analyst Willy Woo uses this same data to demonstrate a pattern that occurs before the bull rally, the criteria which are being met once again.

Start Of A Bull Run?

In a recent string of tweets, analyst Willy Woo presents data from on-chain analysis that points to the bitcoin dump having reached its bottom. According to him, “Price in relation to on-chain demand from both speculative and hodl category of investors are now both at peak oversold levels.” Woo points out that the last time that something like this had happened was when bitcoin reached its bottom following the COVID crash.

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The analyst further outlines the times where this has happened in the past. Going as far back as 2012, he points out the same had been the case in February of that year. What followed had been the memorable 2021-2013 bull run that saw bitcoin gain more popularity among investors.

Related Reading | Bitcoin Halving To Bring The Subsequent Crypto Frenzy

Fast forward to 2015 and the same had been the case in January of that year. This time, the on-chain metric spelled the bottom of the bear market that had begun previously in 2014, putting an end to the onslaught.

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If Woo is right and the on-chain metric continues the way it has historically, then bitcoin may very well have reached the bottom, suggesting that this is the end of the downtrend. However, there is no telling if this is actually the case given that bitcoin had recorded back-to-back bull rallies in 2021.

Bitcoin On The Charts

Bitcoin has lost almost 50% from its all-time high of $69k which it hit in November of last year. This has however not affected the profits of the majority of holders. The digital asset remains one with the highest volume of holders that remain in profit after the market crash.

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According to data from IntoTheBlock, 60% of all bitcoin holders are still in profit at current prices. It is important to note that the cryptocurrency was subject to massive sell-offs when investors panicked that the downtrend will continue. Most however have still kept their highly profitable status, with only 35% of all holders currently losing at market prices.

Bitcoin price chart from

Bulls struggle to pull BTC up as bears take hold | Source: BTCUSD on

The majority are long-term holders and indicators point to investors still being very bullish on the digital asset despite the downtrend. With its current growth curve, it is expected that the cryptocurrency will see 1 billion holders in the next four years, making it a highly sought-after asset.

Featured image from Bitcoin News, chart from


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Willy Woo: ‘Peak fear’ but on-chain metrics say it’s not a bear market

Bitcoin analyst and co-founder of software firm Hypersheet Willy Woo believes that on-chain metrics show that BTC is not in a bear market despite observing “peak fear” levels.

Speaking on the What Bitcoin Did podcast hosted by Peter McCormack on Jan. 30, Woo cited key metrics such as a strong number of long term holders (wallets holding for five months or longer) and growing rates of accumulation suggest that the market has not flipped the switch to bear territory:

“Structurally on-chain, it’s not a bear market setup. Even though I would say we’re at peak fear. No doubt about it, people are really scared, which is typically […] an opportunity to buy.”

In the short term, Woo noted that “you don’t often get this kind of pullback without it relief bouncing” and that a potential capitulation down to the $20,000 doesn’t appear feasible as it would replicate the 2018 crash into a bear market in the space of just three months as opposed to a year.

The price of BTC has declined around 44% since its all-time high levels of $69,000 in November, and the analyst cited institutional futures trading as a key reason behind this steady decline and flat performance over the past three months.

Woo suggested that the increasing influx of mainstream traders and roll out of BTC futures markets over the past few years has significantly changed the market structure of BTC in which the price directly correlates to “risk-on risk-off from macro traders looking at traditional stocks.”

“You know back in 2019 to 2020, if you looked on-chain at what the investors were doing, they were accumulating but you just couldn’t see any impact of price because the price was really dictated by traders on the futures exchanges,” he said.

The analyst cited a large number of long-term hodlers who haven’t sold for more than five months, traders who stopped selling around the $40,000 region along with a steady rate of accumulation as key reasons to remain bullish.

Related: Bitcoin price closes in on $40K, but pro traders are still skeptical

“Most of the coins have been sitting there for longer than five months and people who do that, they’ve held on for five months, they’re not selling at a loss, they will sell when there’s profit to be had and you’ll see that whenever it breaks out of like all-time highs and does a really strong rally.”

He also argued that a key indicator for bear markets is usually when “newbs” or new coin hodlers are in the majority:

“The 2018 bear was at peak new guys holding the coins, and the cycle repeats. Those guys either sell, or the ones that don’t become hardened hodlers and they sell on the next rally when it goes even higher.”