Does Bitcoin Reflect Its Past Market Recovery? VanEck thinks so…

• VanEck analysts believe that BTC is on track for a strong recovery
• Analysts pointed to strong network activity and a decline in funding costs in BTC Futures

This is evident from VanEck’s monthly report Bitcoin [BTC]the world’s largest digital asset has shown remarkable resilience of late. In fact, it now reflects the previous market recovery, the report said.

VanEck’s analysts, Mathew Sigel and Nathan Frankovitz, noted that BTC’s strong network activity and a decline in future funding costs could be signs of a likely strong recovery.

“Bitcoin network activity remained robust with an 83% increase in Ordinals registrations, while Bitcoin futures funding costs fell, reflecting the risk appetite we saw in previous market recoveries.”

BTC’s funding costs reflect the recovery in May and July

Notably, BTC funding rates – fees paid by traders to hold perpetual futures contracts – fell to similar levels during the recovery in May and July.

“Over the past 30 days, the annualized cost of funding Bitcoin futures has fallen from ~11.6% to ~8.8%, representing a relative decline of ~24%. These levels indicate risk appetite similar to that seen during the market recovery following a more than 20% BTC price drop in early May and July of this year.”

Despite the positive situation for BTC, the recent decline in August has reduced addresses with profits by around 9%. Overall, the number of BTC users with unrealized gains was 84%, according to the report. The remaining users with losses were mainly short-term investors.

However, the analysts noted that the recent price declines were normal retracements during BTC’s bull markets.

Moreover, pressure from BTC miners has decreased, as evidenced by the decline in miner sell-offs.

“Transfer volumes from miners to exchanges have fallen 21% over the past 30 days, indicating that miners have stabilized after their sales rose significantly following the halving in June and July.”

Source: VanEck

At the time of writing, Bitcoin’s higher time frame chart was bullish after rising above the short-term supply area at $63,000 and reclaiming the 200-day SMA (Simple Moving Average).

Source: BTC/USD, TradingView