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<\/p>\nKi Young Ju, the CEO of data analytic firm CryptoQuant is convinced that Bitcoin is on the cusp of a major lift-off as crypto traders continue to switch from a risk-off to risk-on mode.<\/p>\n
Earlier yesterday, Young tweeted that Bitcoin had \u201centered into the early bull phase\u201d, suggesting that the top cryptocurrency by market capitalization could be preparing to push higher. Despite plunging by roughly 77% on the back of macroeconomic headwinds and a wider route in the crypto industry last year, Bitcoin has had a good run so far this year. This month alone, the crypto asset\u2019s value grew over 40%, fully recovering from the FTX-induced sell-off and perching above levels last seen in August.<\/p>\n
According to Young, whereas the asset\u2019s price could pull back following the recent pump, there is a higher chance that it will continue to rise as various metrics turn positive.\u00a0Highlighting the MVRV ratio, a profit and loss indicator that measures if the bitcoin price is undervalued or overvalued, the pundit noted that most investors were still underwater, reducing the incentive to sell.<\/p>\n
Typically, when MVRV is above 3.7 (red area), bitcoin is said to be overvalued (market tops), and when it is below 1 (green area), bitcoin is said to be undervalued (market bottom). Recently the MVRV indicator moved above 1 (1.07), signalling the beginning of a bull cycle.\u00a0<\/p>\n
In Young\u2019s words;<\/p>\n
\u201cNo one would want to sell here at a significant loss. If someone sells a lot, it’s highly likely forced & unwanted selling due to bankruptcy, government-seized coins, etc.\u201d<\/em><\/p>\n On Wednesday, Young also stated that there was a likelihood that wealthy investors would purchase struggling US-based\u00a0Bitcoin\u00a0(BTC) mining companies and their crypto holdings at a discount this year, preventing further miner capitulation. According to him, such acquisitions would significantly remove systematic risks associated with the mining sector, igniting a bullish storm for BTC and other cryptocurrencies.<\/p>\n
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