Bitcoin’s 2023 Rally: Spot Demand, Supply Trends and Catalysts

Summary

This March 2023 analysis evaluates Bitcoin’s rally through relative performance, correlations, volatility, derivatives positioning and on-chain supply measures. It argues that the advance appeared more tied to spot accumulation than leveraged futures speculation, citing mostly flat funding and basis, open interest below levels seen in comparable rallies, and relatively little CME activity. It also reports a shift in Bitcoin’s recent correlation toward gold and away from equities, while acknowledging that macroeconomic conditions could change the outlook.

Supply indicators discussed include coins held in profit, SOPR, accumulation addresses, age bands, wallet-size distribution and exchange balances. The note interprets longer holding periods and retail-wallet accumulation as supportive, then considers the coming halving, Mt. Gox creditor distributions and miner selling as possible supply catalysts. These readings are not proof of future price direction: the halving’s effect may be anticipated or smaller than past episodes, Mt. Gox payouts and selling remain uncertain, and the metrics describe conditions at the publication date.

Key ideas

• Flat funding and basis, alongside comparatively modest open interest, were presented as signs of a spot-led rally.
• The note used SOPR, supply age, accumulation addresses and exchange balances to assess holder behavior and available supply.
• Small wallets were reported to be accumulating while the number of very large holders had declined.
• The halving could reduce new issuance, but its market impact may be smaller or already priced in.
• The author expected limited Bitcoin selling from Mt. Gox distributions, while noting uncertain timing and outcomes.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.