Bitcoin is trading around $23,100 in late January 2023 — up 40% from the November 2022 low of $15,500. After the collapse of FTX and the generalised crypto market capitulation, data is beginning to show stabilisation signals.
The context: the 2022 capitulation in numbers
2022 was the worst year in Bitcoin's history in terms of absolute value loss. From $47,000 in January to $15,500 in November, a 67% decline. This correction was amplified by three exogenous shocks: the Terra/Luna collapse in May (-40% in one week), the Three Arrows Capital bankruptcy in June, and the FTX collapse in November.
On-chain data shows accumulation
According to Glassnode, Long-Term Holder Supply is back at 72% — its highest level since 2020. Holders who resisted the 2022 panic continue to accumulate. The MVRV ratio has recovered to 0.9 — still below 1.0, indicating the overall market is still slightly underwater on average, but the trend is upward.
The Fed pauses its tightening cycle
The Federal Reserve raised rates by 25 basis points at its February meeting — a slowdown from the 75 bps hikes of 2022. The market interprets this slowdown as a signal of the end of the tightening cycle. This anticipation benefits all risk assets.
What this data does not tell us
A bounce from a cycle low does not mean the bear market is over. In 2018-2019, Bitcoin bounced 50% from its low before retesting lower levels. Caution remains warranted as long as MVRV does not sustainably recover above 1.0.