Bitcoin Slides Whilst on Chain Metrics Show Long Term Holders are Accumulating

GB Market Commentary 14/01/2022

by Marcus Sotiriou

After Bitcoin’s bounce from under $40,000 to $44,500, it slid off yesterday as equity markets took a tumble. It is now consolidating around $42,500, but once the equity market reaches stability I think crypto will bounce back to the $45-46k region in the coming days. On-chain metrics from Delphi Digital shows that, after months of offloading Bitcoin at the end of last year, long-term holders have accumulated Bitcoin throughout January’s downfall. This gives a positive outlook for Bitcoin’s price in the short-mid term.

The ‘Ethereum killer’ Near Protocol has been a standout performer over the past few months rising from a low of around $6 in December to a high of around $20 yesterday. This is mainly put down to Near’s $800 million ecosystem fund which was announced in October, in order to attract development. There has been a substantial increase in awareness for Near Protocol as investors see great value with having the biggest blockchain ecosystem fund to date.

Yesterday it was announced that Near Protocol are raising a further $150 million from major crypto investment firms including Andressen Horrowitz, Alameda Research and Three Arrows Capital in order to scale DeFi applications. CEO of Three Arrows Capital, Zhu Su, said “Pumped to lead this growth round for Near protocol, it is going to be a big year for crypto adoption and massively scalable DeFi”. I think that the NEAR token may be overheated in the short term after an incredible rally, but its platform will achieve significant adoption over the coming years, and it is one of the safer long term bets with credible backing and significant funding.

Other ‘Ethereum killers’ are also gaining traction, as Cardano has onboarded 72 smart contracts in the last 30 days. After years of research and waiting for the integration of smart contracts, this increasing number of developers joining the network validates the notion of Cardano competing with Ethereum. This could signal the start of a bounce back for the Cardano token, ADA, which has dropped off substantially since the hype of smart contracts launching.