After a largely positive performance over the past few days, the Bitcoin price slowed somewhat over the weekend, falling below $73,000 in the early hours of Saturday, April 11. Investors are starting to increase their exposure to the world’s largest cryptocurrency by market capitalization, according to OnChain analysts.
Are Investors Using BTC as a Hedge Against Inflation?
In a recent post on the X platform, anonymous market expert Darkfost shared that a behavioral change is currently occurring among Bitcoin investors. The cryptocurrency analyst said this trend can be observed through liquidity cycles over the past few weeks.
Highlighting data from Checkonchain, Darkfost based its analysis on Capital Rotation Net Position Change, which measures fund flows between major cryptocurrencies (in this case Bitcoin), stablecoins and fiat currencies. This indicator tracks whether investors are moving capital into riskier assets (risk appetite) or risk-free assets (safety sentiment).
Additionally, the Capital Circulation Net Position Change indicator calculates the 30-day net change in realized capitalization of digital assets. According to a post by Darkfost, Bitcoin’s realized cap fell to an extremely low level of -$28.7 billion at the end of February.
Source: @Darkfost_Coc on X
At the same time, while BTC’s realization limit has been decreasing, the stablecoin market cap has been steadily increasing, reaching over $6 billion. While this rise in stablecoin market capitalization reflects a clear intention by investors to protect their capital, its coincidence with a decline in Bitcoin’s realized market capitalization marks the first such rotation since the previous bear market.
According to Darkfost, this behavior appears to be undergoing a gradual shift, with the Bitcoin realized cap recovering to -$3 billion while the stablecoin market cap declines to -$1 billion. This change suggests that investors are slowly starting to re-expose themselves to the market, which can be seen in BTC’s recent price action.
Darkfost added:
For now, this remains a modest development, but if this dynamic continues, Bitcoin could potentially extend its ongoing recovery rally. It is even more interesting to observe that this dynamic began to emerge precisely at the height of uncertainty surrounding the Iran conflict.
The analyst concluded that some investors appear to be beginning to view Bitcoin as a hedge against inflation and macroeconomic risks, especially in the current global market environment.
Bitcoin price at a glance
As of this writing, the BTC price is around $72,800, with no significant changes over the past 24 hours. The top cryptocurrency rose more than 8% during the week, according to data from CoinGecko.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image created by DALL.E, chart by TradingView
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