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Cathie Wood’s Ark Invest evaluates Bitcoin’s current situation & potential future

By:
on Aug 4, 2023
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  • Ark Invest’s analysis evaluates Bitcoin’s current and future outlook.
  • Healthy network activity, low volatility, and miner dynamics suggest upcoming massive price action.
  • Network liveliness bolsters BTC's bullish outlook

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Ark Invest’s thorough report evaluates Bitcoin’s current situation and potential future outlook. With volatility at lows never witnessed since 2017, regulatory challenges, and health network activity, David Puell’s research forecasts an upcoming massive price action.

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Ark Invest analyzes Bitcoin’s situation

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Bitcoin has attracted Ark Invest’s attention as its volatility dipped to 6-year lows in July, mirroring 2017 levels. The extended calmness precedes possible turbulence for the leading cryptocurrency by value, suggesting substantial price actions in the upcoming sessions. Nonetheless, the price can move in either direction.

Meanwhile, Bitcoin maintains a healthy network activity, with Ark issuing a bullish view on various platform metrics. Mining difficulty increased by 3.32% in July, confirming stale network security. Also, Bitcoin continued to attract new users.

Source – Ark Invest

Active owners soared 8.16% over the past month and 14.15% within the last year. Also, Ark remained bullish on BTC holder behavior as locked supply increased by 0.6% while time-weighted turnover reduced by 37.97%.

Miner capitulation issues a contrasting but optimistic narrative. The declined hash rate might suggest oversold conditions, indicating bullish revivals.

Liveliness metric bolsters positive bias

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Source – Ark Invest

Network liveliness bolsters positive bias as holders retaining their tokens reduces selling momentum. The report indicated the best longer-term holder sentiment since Q4 2020, as liveliness dipped beneath 60% in July. The metric measure possible selling momentum relative to the present holding behavior.

Macro factors and Bitcoin’s narrative

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Players should also factor in macro developments and their impact on Bitcoin. The Fed’s significant rate hike might reflect in crypto’s performance. Bitcoin might see improved appeal as an inflation hedge, considering softening CPI figures.

Ark’s report indicates that the Federal tightening effect is yet to hit the markets fully. Expert economist Milton Friedman stated that financial policy works with long & variable lags that take between 1 year and 18 months. That suggests that the Federal’s 22-fold hikes are yet to impact the markets. It highlighted,

“Interest rate-sensitive sectors like housing and manufacturing already are in a recession. The rest of the economy could be next.”

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