Bitcoin (BTC) only needs one more key signal on the chain for a classic bull market to begin, says analyst David Puell.
In a tweet on Dec. 17, the creator of the Puell Multiple argued that the stage is almost set for the end of the BTC price bear market.
Puell: Bitcoin network activity “disappointing”
Despite many calling for new BTC/USD lows of $12,000 or below this cycle, not everyone is entirely bearish on the outlook for Bitcoin.
For Puell, there are already two essential phenomena in the chain necessary for the recovery of the BTC price.
Long-term (LTH) holders are resisting the urge to sell even though Bitcoin is down more than 70% from its last all-time high.
At the same time, short-term “speculators” are feeling a sharp pain from the recent price action. As Cointelegraph reported, these “tourists” are likely to have mostly left the market by now.
All that’s missing, Puell believes, is an increase in network activity from all participants.
“On-chain, three factors are needed for a bull: 1. Long-term investor retention behavior. 2. Painful losses of short-term speculators. 3. Activity of the network in all areas, ”he summed up.
“Personally seeing 1 and 2. 3 is still disappointing.”
He added that “favorable” macro conditions would help the turnaround, as well as cryptocurrencies becoming more resistant to “contagion” in the form of exogenous and endogenous “swans.”
BTC/USD was trading around $16,700 at the time of writing, data from Cointelegraph Markets Pro and TradingView showed.
A Bitcoin halving cycle like any other?
That perspective is in line with others calling for calm on the current price performance of BTC.
Among them is popular analytics account Dilution-proof, which back in the day drew attention to BTC/USD simply by copying past bear market behavior.
The evidence came in the form of Bitcoin’s MVRV-z score, an expression of market capitalization to realized capitalization in standard deviations. Dilution testing was initially called the “Market Value Temperature to Realized Value Temperature (MVRVT)” metric.
Currently, as the accompanying charts show, signs point to a classic, dilution-proof, bear market bottom formation that indicates that Bitcoin “is just doing what it does on this post-halving date literally every cycle.”
Cointelegraph previously included MVRV-z in a list of “striking similarities” between 2022 and previous price cycles.
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