It’s Not Just About Price – Bitcoin Fundamentals Have Bullish Taste

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If your primary concern is NGU (Number Go Up) technology, the last year has no doubt been difficult. Bitcoin is down 33 percent over the past year, and in particular, the last six months have been brutal, as bitcoin slid below $40,000 from its November high of just under $69,000. However, for HODLers looking to separate the signal from the noise, there are several bullish indicators worth paying attention to.

New All-Time High for Mining Difficulty

As of last Friday, Bitcoin’s mining difficulty reached a new all-time high of 27.97 trillion hashes, suggesting that bitcoin mining is becoming more competitive than ever.

As a point of reference, Bitcoin’s difficulty was 13.67 in mid-July 2021, shortly after China banned Bitcoin for the 19th (?) time. Today it is up 105 percent from its lows.

Bitcoin mining difficulty over past 12 months. Source: Coinwarz

At the same time, Bitcoin’s hash rate continues on an upwards trend:

While these factors are perhaps not as exciting to the ordinary person as price, they are far more important, as they provide unequivocal evidence that Bitcoin is becoming more secure than ever before.

Long-Term HODLers Have Conviction

Glassnode’s “HODL Waves” chart aims to illustrate bitcoin UTXO (unspent transaction output) age distribution. Essentially, this shows when bitcoins were last spent, and how spending patterns change over time.

HODL waves. Source: Glassnode

According to the latest available data and as shown above, 60 percent of bitcoins have not moved over the past year. In short, these are HODLers who have ridden the price all the way up, and then down 33 percent, without selling. That speaks to tremendous conviction and represents a 5 percent increase in HODLers from the same time last year.

Take It Easy, and Stack Cheap Sats While You Can

Warren Buffet has equated Bitcoin with rat poison, but that aside, he does have a point when he says “be fearful when others are greedy, and greedy, when others are fearful”.

For HODLers who have done the work, now represents as good a time as any to continue stacking sats while they are on sale.

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