Bitcoin experienced a 7% drop earlier this week, but recovered slightly on Friday to hover around $97,000. On-chain data shows a gradual recovery in institutional demand, with holders buying back recent losses. The CryptoQuant report highlights that BTC has not reached overvaluation levels and predicts that the rally will continue and reach $146,000. Other signs of optimism include Morocco legalizing cryptocurrencies and MicroStrategy and Marathon Digitat adding BTC to their holdings.
Bitcoin (BTC) experienced a 7% correction at the beginning of the week, falling to $90,791 on Tuesday, but recovered to $97,000 by Friday. On-chain data suggests that institutional demand is slowly recovering and holders are buying the push. A recent report predicts that BTC remains undervalued and could rise towards $146,000. There is further optimism as Morocco legalizes cryptocurrencies and major companies such as MicroStrategy and Marathon Digital increase their BTC holdings.
Bitcoin institutional demand and BTC holders show signs of recovery
Bitcoin failed to reach the $100,000 milestone last week and started this week lower. It fell 7% to a low of $90,791 on Tuesday, but recovered slightly on Wednesday to close above $95,500 and was hovering around $97,000 at the time of writing on Friday.
This week, institutional demand provides a clear outlook on Bitcoin's rebound and recovery. Data from the Coinglass Bitcoin Spot Exchange Traded Fund (ETF) showed that the week started with two consecutive days of outflows, reaching a total of $558.1 million by Tuesday, but demand slowly recovered through Thursday. . If this inflow trend continues or accelerates, it could fuel the ongoing Bitcoin price recovery.
Total Bitcoin spot net inflow chart. Source: Coin Glass
As seen in the chart below, holders have bought back recent declines this week. CryptoQuant Exchange Netflow shows that holders had accumulated a total of 35,449.3 BTC by Thursday after BTC corrected from Monday's high of $98,871 to Tuesday's low of $90,791 (3 red bars (indicated by a bar).
Net flow chart of Bitcoin exchange. Source: CryptoQuant
Glassnode's weekly report highlights that Bitcoin prices have risen more than 42% in the past three weeks, even as holders are accumulating recent losses. This surge helped long-term holders realize unprecedented daily gains of $2.02 billion, hitting a new all-time high. The resulting supply overhang may require a reaccumulation phase before sustained price increases occur.
BTC Entity Adjusted LTH Realized Profit Chart. Source: Glassnode
The report explains that most of this sell-side pressure comes from coins with time periods ranging from six months to one year, accounting for 35.3% of the total. This suggests that more senior investors remain cautious and may be patient for potentially higher prices. These sales could represent swing-trading style investors who accumulated after the ETF's launch and planned only to ride the next wave of the market.
BTC: Cumulative realized profits by age (November 2024) chart. Source: Glassnode
Report plans $146,000 equivalent for Bitcoin
CryptoQuant’s weekly report highlights that BTC has not reached overvaluation levels and predicts that the rally will continue and reach $146,000.
Although the price has corrected towards $91,000 this week, the chart below shows that valuation metrics still point to a bullish market and that BTC has yet to reach the overvalued levels typically seen prior to the end of a bullish cycle. It shows that.
Bitcoin profit and loss index chart. Source: CryptoQuant
The report further explained that Bitcoin's highest price target is currently $146,000 in terms of realized price valuation (red line). This price range served as a high for Bitcoin price in previous cycles such as April-May 2021.
Bitcoin realization price range chart. Source: CryptoQuant
Other signs of optimism
Multiple optimistic news and events could support BTC’s rally towards the $100,000 milestone. MicroStrategy revealed on Monday that it made another big Bitcoin purchase, acquiring 55,500 BTC for $5.4 billion, bringing its total holdings to 386,700 BTC.
Fideum co-founder Darren Franceschini said in an exclusive statement to FXStreet that MicroStrategy's approach offers investors the opportunity to participate in Bitcoin's bullish trend. He further stated that the company is actively shaping the future of finance.
“By adopting Bitcoin at scale, the company is not only hedging its future, it is actively shaping it,” Franceschini said.
On Tuesday, Morocco announced it was lifting a ban on digital assets imposed in 2017 and moving towards legalizing all cryptocurrencies. The country's central bank, Al Maghrib Bank, is reportedly preparing a new bill to regulate cryptocurrencies, which is currently under consideration. .
The digital finance landscape is rapidly evolving, with countries such as Morocco and the United Kingdom actively working on cryptocurrency regulation. These changes signal a move towards a more structured and secure environment for cryptocurrencies, and as global interest in digital finance grows, more countries are likely to follow suit.
Additionally, on Thursday, Marathon Digital (MARA) Posted The official Twitter account stated that it acquired an additional 703 BTC in November, increasing the total to 6,474 BTC, with $160 million still available for future BTC dip purchases.
Marathon holds approximately 34,794 BTC, worth $3.3 billion, making it the second-largest corporate Bitcoin holder after MicroStrategy. Marathon holds 0.16% of the total Bitcoin supply, while MicroStrategy holds 1.8%.
Will BTC rise to $100,000 or correct to $90,000?
Bitcoin price reached an all-time high (ATH) of $99,588 last week and began to fall. BTC corrected by 7% and fell to a low of $90,791 on Tuesday. However, there was some improvement on Wednesday. As of this writing on Friday, the stock continues to recover, trading around $97,000.
If BTC continues its recovery, it could reach the ATH level of $99,588. The Relative Strength Index (RSI) indicator on the daily chart is at 67, above the neutral level of 50, indicating bullish momentum. However, traders should be cautious as the Moving Average Convergence Divergence (MACD) indicator showed a bearish crossover on Tuesday, indicating a sell signal.
BTC/USDT daily chart
If BTC fails to recover and continues to decline, the decline could widen to re-test the key psychological level of $90,000.
Frequently asked questions about Bitcoin, altcoins, and stablecoins
Bitcoin is the largest cryptocurrency by market capitalization and is a virtual currency designed to function as money. This form of payment is not controlled by any particular person, group, or entity and eliminates the need for third parties to participate during financial transactions.
An altcoin is any cryptocurrency other than Bitcoin, but some consider Ethereum to be a non-altcoin because it is these two cryptocurrencies that forks occur. If this is true, Litecoin would be the first altcoin to fork from the Bitcoin protocol and thus be an “improved” version of it.
A stablecoin is a cryptocurrency that is designed to have a stable price, and its value is backed by the reserves of the asset it represents. To achieve this, the value of one stablecoin is pegged to a commodity or financial instrument, such as the US dollar (USD), and its supply is regulated by an algorithm or demand. The main purpose of stablecoins is to provide an on/off ramp for investors who wish to trade and invest in cryptocurrencies. Also, since cryptocurrencies are generally volatile, stablecoins allow investors to store value.
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the market capitalization of all cryptocurrencies combined. This clearly shows the interest in Bitcoin among investors. BTC's dominance typically occurs around bull markets, where investors turn to relatively stable, high-market-cap cryptocurrencies like Bitcoin. Decreasing BTC dominance usually means investors are moving their capital and profits to altcoins in search of higher returns, which usually causes an explosive rally in altcoins.
