- Ark Invest says âBitcoin’s price is in the early-to-mid stages of a bull market.â
- Investors also remain bullish despite new US inflation figures.
The Bitcoin rally is steaming ahead and shows no signs of slowing.
Thatâs the takeaway from Ark Investâs latest Bitcoin market report, published Wednesday.
The report came hot off the press as new US inflation figures slashed hopes that the Federal Reserve will cut interest rates.
Even so, Ark Invest is not the only Bitcoin watcher to remain bullish.
Ark Invest
Bitcoin has exploded this year, reaching a new all-time high of $73,000 in March.
Ark invest says this is only the beginning.
âCompared to past cycles, its MVRV Z-score suggests that Bitcoinâs price is in the early-to-mid stages of a bull market,â Cathie Woodâs investment management firm wrote.
MVRZ Z-score is a commonly used metric to identify periods when Bitcoin is either undervalued or overvalued.
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MVRV stands for âmarket value to realised value.â The Z-score is a standard deviation test that pulls out the extremes in the data between market value and realised value.
The metric looks at three factors: Bitcoinâs current market value, the realised value, and the Z-score.
The realised value is the average price of each Bitcoin when it was last sent between wallets, multiplied by the total number of coins in circulation.
Ark Invest was also bullish about Bitcoin scaling solutions â such as roll-ups and sidechains â which have gained momentum since the second half of 2023, counting âmore than 50 independent projectsâ building on the Bitcoin base layer.
âGiven Bitcoinâs price appreciation and increasing venture capital commitments, these trends could continue in the current bullish cycle,â Ark Invest said.
Inflation figures
Ark Investâs report came mere hours after new data showed that US inflation is accelerating. That could be bad news for cryptocurrencies.
âHigher inflation may kill any hopes that interest rates would be cut any time soon,â Hans-Stefan von Hänisch, director and Singapore head of sales trading at crypto exchange OS, told DL News.
âThis directly impacts market liquidity and risk tolerance, so in theory it can restrict speculative trading activity in crypto markets.â
However, he added that âbullish narratives within the crypto spaceâ â such as the buzz around the upcoming halving event and the growth of US spot Bitcoin exchange-traded funds â âmay help support prices in the short to medium term.â
Similarly, Sean Stein Smith, an associate professor of accounting at Lehman College in New York, told DL News that âhigher rates will continue to encourage investors to seek out high-performing assets like Bitcoin.â
Crypto market movers
- Bitcoin was up 2.1% over the past 24 hours to $70,430.
- Ethereum is up 1.2$ to $3.550.
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Eric Johansson is DL Newsâ News Editor. Got a tip? Email at eric@dlnews.com.