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VanEck Turns Bullish on Bitcoin Amid Market Recovery Signals

In a recent report, VanEck, a well-known asset manager, announced a bullish outlook on Bitcoin, highlighting key market developments.

The analysis references historical bullish signals stemming from derivative markets alongside favorable network metrics.

Notably, Bitcoin’s realized volatility has decreased from 56% to 41% as political tensions between the U.S. and Iran eased, while its 7-day average funding rate recently hit a low of -1.8%.

Such negative funding rates are traditionally associated with strong bullish behavior, with Bitcoin’s historical returns during similar conditions averaging 11.5%.

Interestingly, the drop in hash rate is another factor contributing to VanEck's positive sentiment, as previous declines have typically led to significant price recoveries.

The report mentions that in six out of seven past occurrences of low hash rates, Bitcoin saw a median return of around 37.7% over the following 90 days.

On the institutional front, after experiencing substantial outflows earlier in the year, Bitcoin exchange-traded products (ETPs) have shown net inflows in six of the past seven weeks, indicating renewed interest.

Conversely, the options market reflects a more cautious approach, as elevated put option premiums suggest ongoing bearish sentiments, though recent declines in these premiums indicate a potential shift.

The report also notes a mixed picture in on-chain activity, with rising transaction volumes contrasted against a slight decrease in active user addresses.

VanEck ultimately concludes that historical patterns of negative funding rates and hash rate declines bolster their increasingly bullish stance on Bitcoin.