Analyst: Bitcoin’s strong fundamentals will outpace short-term price declines

Market watchers view the current weakness as cyclical and not structural, a pause before liquidity returns to Bitcoin.

Bitcoin (BTC) is trading at around $107,500 as it reaches the latest chapter in a period of mostly sideways movement since hitting an all-time high of over $126,000 on October 6.

Despite the recent decline, assets are up nearly 52% year over year, from $72,350 as of October 31, 2024, to current levels, showing that long-term fundamentals are still strong even though market sentiment may be cooling.

Insight into the current delay

According to crypto analyst Pierre Rochard, Bitcoin’s current lack of movement is because of “OG whales take profits after an epic decade” and traders shift their attention to AI-driven tech stocks like NVIDIA and safe havens like gold. Nevertheless, he noted that these were short-term pressures and that Bitcoin’s “intrinsic utility and fundamental value have only increased.”

Other users agreed, with one pointing out that the market changes were “cyclical rotations, not structural shifts.” The bill added that old investor cashouts, AI games that drain liquidity and increased hedging in gold are typical events in the dynamics that often characterize the end of a cycle.

“When liquidity normalizes and macroeconomic tailwinds return,” they wrote, “capital will return to scarcity and neutrality – and Bitcoin remains the purest expression of both.”

Long-term holders have indeed taken profits, with a report from Glassnode coming out in August showing that those who held BTC for more than 155 days made 3.27 million BTC in profits this cycle, a record surpassed only by the 2017 peak. However, despite the selling, metrics like the Adjusted MVRV ratio remained balanced, indicating that long-term confidence has not faded.

Meanwhile, gold’s market value recently reached $29 trillion, up 56% in the past year, presenting itself as a more attractive alternative to investors than its digital counterpart. Still, with the precious metal’s RSI at 91.8, analysts like Crypto Rover say it looks “overbought,” meaning a shift of funds into Bitcoin could happen soon.

At the same time, institutional selling has also shaped recent market behavior. Reports in late July showed that major companies such as Galaxy Digital were selling large BTC positions as prices approached $120,000, a move that analysts viewed as strategic profit-taking rather than a structural exit.

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The plea for lasting power

For Rochard and others, these patterns are part of a normal cool-down phase after a big rally. Trader Daniel Tschinkel added up it up: “Liquidity has temporarily shifted, but that doesn’t change Bitcoin’s structural strength.”

With its steady supply, growing institutional presence through ETFs, and growing utility as a neutral settlement layer, experts believe the long-term value of this asset remains as strong as ever.

Looking at the market, the flagship cryptocurrency has traded between $108,201 and $113,567 over the past 24 hours, falling 2.6% in that time but rising 1.2% over the week. Over the past month, it has fallen slightly by 3.4%, although it is still ahead of the broader crypto market, which rose 0.9% this week.