Bitcoin’s an Attractive Asset as a ‘Hedge Against Traditional Financial Markets’


  • Bitcoin holding $7,500 level would be a really bullish sign
  • Bitcoin seeing growth in active addresses indicating new investors in the market
  • With global markets seeing massive uncertainty and traditional safe-haven assets like oil plunging, “BTC is becoming a more attractive asset”

Yesterday, we saw the stock market rising despite another 4.4 million unemployment claims, though lowest in a month, the numbers were still higher than the highest level ever recorded before the coronavirus hit. Analyst Mati Greenspan in his daily newsletter Quantum Economics wrote,

“But that's being discounted because it wasn't as bad as analysts were predicting. I know we'd all like to see the glass as half full but at this point, it's completely empty.”

The real reason behind stock rallying, however, is “an overwhelming helping hand from the Fed who continues to support the market with free money.”

Unlike the stock market that wiped its gains instantly after the news that Gilead’s failed antiviral drug, Bitcoin kept its gains and is currently trading around $7,500.

After trading in a tight range over the past few weeks, the digital asset has finally broken to the upside. With this pop, the $7,450 level that has been pretty significant over the last month and had been acting as a resistance level on the way up is now being tested as a level of support, now that we’re above it.

Even if BTC drops back down after the breakout, “it is still quite significant from a psychological standpoint, because it imprints a higher high. If support does hold though, it would be a really bullish sign,” said Greenspan.

Bitcoin Fundamentals Growing

Just like the price, on-chain fundamentals are showing a significant increase in the activity on the Bitcoin network.

Bitcoinonchainfundamentals

Source: Glassnode – Bitcoin on-chain fundamentals (7D MA), 15- 22 April

This recovery has us at pre-crash levels which are to be expected due to upcoming halving and revival in widespread retail interest in the leading cryptocurrency.

Another uptrend is seen in the number of active entities that has reached its highest point since the bull run of July 2019. These Bitcoin active addresses excluding in-house transactions may indicate “new investors entering the market.”

glassnodeactiveaddresses

Source: Glassnode

Overall addresses holding BTC actually grew 24% in the past year, with those holding equal to or more than 0.01 BTC surging 18.5% and those holding 0.1 BTC or more rising 14.6%. Those addresses with a balance of 1 BTC and more also jumped 11.4% in the last year.

As we saw this week, global markets continue to see massive uncertainty and instability with traditional safe-haven assets like oil plummeting below zero for the first time.

This could be one of the reasons, “BTC is becoming a more attractive asset, acting as a hedge against traditional financial markets,” noted Glassnode.

CME bitcoin futures volume and open interest is also back to a month high after seeing a significant decline after the crash, unlike unregulated exchanges that recorded huge growth.

“~1500 contracts were rolled from April to May, ~1200 contracts remain open for expiry later today,” noted crypto data tracker Skew.

CME bitcoin futures volume open interest

Source: Skew

We are currently heading into some good months of Bitcoin as April to June has always been a “strong period” since 2014. Also, Apr/May/Jun the top 3 median months are coinciding with the halving, ensuring increased scarcity in a world where the money supply of fiat currencies is drastically increasing holds a promise for positive action ahead.

Bitcoin (BTC) Live Price

1 BTC/USD =$35,772.8881 change ~ -1.00%

Coin Market Cap

$670.37 Billion

24 Hour Volume

$27.12 Billion

24 Hour VWAP

$34.79 K

24 Hour Change

$-356.88

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