At its meeting on Wednesday, the Federal Reserve did not raise interest rates, but it did suggest that they might do so for a longer time.
The S&P 500 is down more than 2% and the Nasdaq is down around 3% this week; these declines might be attributed to this decision.
In contrast, Bitcoin showed relative strength by maintaining its value at $26,600 from the previous week and outperforming other cryptocurrencies over the prior 30 days.
In a recent blog post, the on-chain analytics company IntoTheBlock explains why Bitcoin has recently outperformed the stock market. The big cryptocurrencies’ ability to maintain above-key support levels, including Bitcoin, is still a sign of hope.
BTC was trading at $26,568 at the time of writing, down 0.13% over the previous day.
Key facts explaining BTC’s steady price action
The stability of Bitcoin’s price may be explained by a few factors that IntoTheBlock emphasised. First off, Bitcoin is in a strong position since, despite the DXY’s rise, its correlation to the dollar has achieved a value of zero. Second, in anticipation of a Bitcoin ETF, holders are hesitant to sell in advance.
https://x.com/intotheblock/status/1705216635244621860?s=20
Third, Mt. Gox postponed their projected 850,000 BTC ($23 billion) refund to customers who were harmed by the attack by a year, lessening the selling pressure that was first anticipated.
Fourth, Bitcoin has become more dominant inside the industry. For the second time this year, Bitcoin’s market share has surpassed 50% in this regard after rising in recent weeks.
Fifth, this week saw an annual high of 2.68x in the market capitalization ratio between Bitcoin and Ethereum. Sixth, Bitcoin’s price stability may also be attributed to its hodlers’ composure.
And last, just like in prior down markets, “hodlers,” or addresses that have been holding Bitcoin for more than a year, have continued to accumulate. Despite the recent decline, hodlers still own a significant portion of the market with 13.44 million coins, or 69% of the available supply.
IntoTheBlock said that the aforementioned pattern may generally imply that a bullish cycle for Bitcoin may be approaching, even if it is unclear how long Bitcoin’s outperformance would last in a deteriorating macro context.
