As of 14:00 Greenwich Mean Time, November 7, 2023, 1 btc to usd had reached $35,200 (CoinMarketCap #CMC257), or 48.8% below the all-time high of $68,789 in November of 2021. But up 113% from the bottom of $16,500 in January of 2023. Price action is driven by numerous factors: The Federal Reserve had raised interest rates cumulatively by 500 basis points throughout 2023, causing the total market capitalization of the cryptocurrencies to reduce from 3 trillion US dollars in 2021 to 1.2 trillion US dollars. The 30-day correlation coefficient between Bitcoin and the S&P 500 index rose to 0.72 (historical median 0.35). On-chain data shows Whale Address, with over 1,000 BTC (11.3% of the tradeable volume) control, deposited 28,000 BTC (around 980 million US dollars) into its address at the support level of 30,000 US dollars, but a sell wall of 3.4 billion US dollars exists at 35,500 US dollars (Glassnode #GN2023).
Market mood is differentiated. The Bitcoin Fear and Greed Index is 56 (neutral range), the open contract value of CME Bitcoin futures is 15 billion US dollars (historical high), but the funding rate of perpetual contracts is only 0.005% (neutral). The leveraged liquidation risk in the derivatives market is concentrated between $32,000 and $36,000, and the estimated margin call is $1.2 billion (Bybit #BYBIT202311). As for institutional action, MicroStrategy held 158,245 BTC (average cost basis of $29,672) with a profit of $1.92 billion. Tesla, however, offloaded 75% of its BTC holdings (as disclosed in its 2022 quarterly report), selling out for $1.33 billion.
Regulatory policies directly influence short-term volatility. In June 2023, the SEC sued Binance (case No. 1:23-cv-01599), resulting in a one-day decline of 7.3% between 1 btc and usd. But if BlackRock’s application for the Bitcoin Spot ETF (Document No. S7-32-23) is approved, It may attract an additional 24 billion US dollars in funds (estimated by the ARK Invest model). The cost structure of mining gives it a boost. The total computational power of the entire network today amounts to 450 EH/s. The average mining cost of electricity is $18,500 per coin, and the cost to shut down is calculated as $16,800 (CCAF data, University of Cambridge).
Technical markers indicate market divergence. The Bitcoin RSI (14 days) is 58.4 (neutral to bullish), while the slope of the 200-day moving average is now positive (+0.8%). However, the MVRV ratio (market cap/realized value) of 1.2 indicates that the valuation remains under the historical bull market cycle average (2.5). Active addresses on the chain (7-day MA) were 980,000, which is 37% lower than the peak in 2021. However, the Lightning network capacity was more than 5,400 BTC (approximately 190 million US dollars), and the payment efficiency was 1 million transactions per second (65,000 transactions per second for Visa).
Macroeconomic disruptions persist. The US Dollar index (DXY) rose to 106.5, and the yield on the 10-year US Treasury at 4.8% has retained the value of risky assets at bay. Politically, while there was conflict between Israel and Palestine in October 2023, Bitcoin rallied by 12% within one day (gold 9.3%), which indicated a growing safe-haven character. In compliance progress, the release of El Salvador’s Bitcoin bonds has been pushed to 2024, with the average value of the nation’s holdings standing at $45,000 (currently suffering a floating loss of 21.8%).