Bitcoin (BTC) only needs one more key on-chain signal for a classic bull market to begin, analyst David Puell says.
In a tweet on Dec. 17, the Puell Multiple creator argued that the stage is almost set for the end of the BTC price bear market.
Puell: Bitcoin network activity “underwhelming”
Despite many calling for new BTC/USD lows of $12,000 or less this cycle, not everyone is wholly bearish on the outlook for Bitcoin.
For Puell, two essential on-chain phenomena necessary for BTC price recovery are already in evidence.
Long-term holders (LTHs) are resisting the urge to sell despite Bitcoin being down over 70% from its last all-time high.
At the same time, short-term “speculators” are feeling acute pain from recent price action. As Cointelegraph reported, these “tourists” are likely already mostly gone from the market.
All that is missing, Puell believes, is a rise in network activity from all participants.
“On-chain, three factors are needed for a bull: 1. Holding behavior from long-term investors. 2. Painful losses from short-term speculators. 3. Network activity across the board,” he summarized:
“Personally seeing 1 and 2. 3 is still underwhelming.”
He added that “favorable” macro conditions would aid the turnaround, as well as crypto becoming more resilient to “contagion” in the form of “exogenous and endogenous ‘swans.’”
A Bitcoin halving cycle like any other?
That perspective chimes with others calling for calm over current BTC price performance.
Among them is popular analytics account Dilution-proof, which on the day drew attention to BTC/USD simply copying previous bear market behavior.
Evidence came in the form of Bitcoin’s MVRV-z score — an expression of market cap to realized cap in standard deviations. Dilution-proof initially called the metric “Market-Value-to-Realized-Value Temperature (MVRVT).”
Currently, accompanying charts showed signs pointing to a classic bear market bottom formation, with Dilution-proof stating that Bitcoin “is just doing what it does at this post-halving date literally every cycle.”
Cointelegraph previously included MVRV-z in a list of “striking similarities” between 2022 and past price cycles.
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