Bitcoin Enters ‘Bargain Zone’ as US Jobs Report Fuels Rate Cut Bets
Market sentiment turns bullish as institutional demand surges and illiquid BTC supply tightens
Fidelity Signals Bitcoin Undervalued Despite ETF Inflows
Bitcoin remains undervalued, even as institutional money pours in through major ETFs like BlackRock’s IBIT, according to Fidelity Digital Assets. The firm’s latest report notes that Bitcoin is currently in a mid-term “optimism” phase, with pricing levels below the asset’s intrinsic network value.
At the heart of Fidelity’s view is the ‘Bitcoin Yardstick’ — a metric that divides Bitcoin’s market cap by its hashrate. A lower ratio points to a cheaper Bitcoin relative to the computational power securing its network. During Q1 2025, this metric hovered between -1 and +3 standard deviations, a notable cooling from the previous quarter. Importantly, the number of days above the 2-standard deviation mark fell from 22 to 15, with zero above 3, suggesting the asset is priced conservatively.
Long-Term Holders Strengthen Market Base
Alongside valuation, Fidelity observed a sharp rise in illiquid Bitcoin supply, climbing from 61.5% to 63.49%, while liquid supply shrank by 4%. This shift underscores increasing holder conviction, as coins are moving into wallets that historically don’t sell.
The Illiquid Supply Shock Ratio—an indicator of potential supply crunches—remains 16% below its 2017 peak, hinting at substantial room for further price growth should demand continue rising.
BlackRock’s IBIT Sees Near-Record $970.9M Inflow
Backing this bullish thesis, BlackRock’s iShares Bitcoin Trust (IBIT) attracted $970.9 million on April 28, its second-largest daily inflow since launching in January 2024. Over the past week, IBIT has seen more than $4.5 billion in net inflows, capturing a commanding 51% share of the US spot Bitcoin ETF market with $54 billion in assets under management.
This stands in sharp contrast to rival funds, with Fidelity’s FBTC and ARK’s ARKB reporting net outflows over the same period.
US Labor Data Pushes Bitcoin Higher on Rate Cut Expectations
Investor sentiment was further buoyed by the March 2025 JOLTS report, which showed US job openings falling to 7.19 million, down from 7.57 million in February and well below the 7.48 million forecast. The decline sparked expectations that the Federal Reserve could cut interest rates sooner than anticipated — a move that typically weakens the dollar and boosts Bitcoin.
Economist Alex Kruger noted that Bitcoin behaves like a “risk/gold hybrid”, particularly in environments where inflation and geopolitical instability intersect. He also linked the asset’s short-term bullishness to tariff de-escalation following Trump’s 90-day pause, which expires July 8.
Looking ahead, Kruger warned of potential Q3 volatility, though he believes Bitcoin’s risk-reward ratio far outshines that of most altcoins, which he described as overbought.
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