tl;dr
Fidelity Digital Assets' Q2 outlook highlights Bitcoin's stability despite a 20% decline from its all-time high, supported by strong on-chain fundamentals, accumulation by long-term holders, and healthy miner activity. Technical signals remain constructive, suggesting potential buying opportunities ...
Fidelity’s Q2 outlook highlights Bitcoin’s stability despite a 20% decline from its all-time high, supported by strong on-chain fundamentals, accumulation by long-term holders, and healthy miner activity.
Technical signals remain constructive, suggesting potential buying opportunities near key support levels, with consolidation phases representing long-term accumulation opportunities.
In contrast, Ethereum experienced a 45% drop with weakened short-term technical indicators and lower network activity, resulting in a negative short-term outlook.
However, valuation metrics indicate potential long-term value, especially with upcoming network upgrades such as the Pectra upgrade that could boost activity.
Bitcoin’s miner health remains stable, with profitability above averages and hash rate growth continuing steadily despite recent halvings.
Institutional adoption and favorable macroeconomic conditions, including possible Federal Reserve rate cuts, support a positive medium- and long-term outlook for Bitcoin.
Ethereum’s network metrics declined in Q1, including reductions in new addresses, active users, and transaction counts;
nonetheless, staking participation rebounded modestly after prior declines, and inflation dynamics shifted slightly inflationary due to higher staking and lower fees reducing ETH burned.
Fidelity advises cautious optimism for Bitcoin investors, emphasizing a neutral short-term environment but an overall positive stance over time.
For Ethereum, despite short-term challenges and technical weakness, the firm highlights potential contrarian value plays for long-term investors, particularly if upcoming upgrades and Layer 2 improvements come to fruition.