Market analyst Axel Adler Jr has shared some valuable insights on the Bitcoin market in relation to recent short-term holders’ activity. This commentary comes as the premier cryptocurrency is currently stuck in a consolidation phase following a flash crash in early February.

Bitcoin STHs Take Profit From Overheated Market – Analyst

In an X post on February 8, Axel Adler Jr explains that Bitcoin Short-Term Holders (STH) i.e. holders of Bitcoin between 1-3 months have been realizing their profits. This development is based on a fall in the STH MVRV – a trading metric that measures market value to the realized value of all Bitcoin held by short-term holders thus helping to determine their profit/loss status.

Generally, an STH MVRV around 1.30-1.35 suggests an overheated market as short-term holders have high unrealized profits indicating potential for a sell-off and price falls. According to Adler Jr., the STH MVRV has recently dropped from 1.35 to average levels meaning a significant portion of STH have closed their positions, helping to cool the market.

Historically, the end of an overheated phase usually translates into a period of price consolidation provided that market demand remains strong. Axel Adler Jr draws a reference to January 2024, when a similar fall in STH MVRV was even strong enough to eventually initiate a price rally. 

However, the crypto analyst cautions that US President Donald Trump’s decisions are largely influencing the current market landscape. This was clearly illustrated last week when the US move to impose new tariffs on China, Mexico, and Canada attracted retaliatory measures causing investors to move funds out of risky assets amidst fears of a brewing trade war.

Axler Adler Jr states that barring any more negative triggers from Donald Trump’s political actions, Bitcoin may break out of its current FOMO-driven consolidation into an uptrend. However, in the case of eventualities, Bitcoin appears to have formed a strong support zone around $90,000 capable of preventing deeper corrections.

BTC Price Overview 

At the time of writing, Bitcoin trades at $96,998 following a 0.98% gain in the last 24 hours. Meanwhile, its trading volume stands at $22.53 billion having crashed by 59.04% in the past day. For the market bulls, relevant resistance levels lie at $102,000 and $106,000. A failure to break above the initial resistance will force Bitcoin to remain in consolidation for the foreseeable future.

Featured image from iStock, chart from Tradingview

The American state of Florida could be one of the pioneering local governments that allows a percentage of its state funds for cryptocurrency investments, particularly Bitcoin.

Florida Senator Joe Gruters has filed a bill that would permit the US state to use 10% of its funds to buy Bitcoin. This political backing could entice other American states to build their own cryptocurrency investments.

My state of Florida introduces a Bitcoin investment bill! 💪
If passed Florida’s CFO may allocate up to 10% of public funds to invest in $BTC or other digital assets.

Thank you Senator Joe Gruters 🫡 pic.twitter.com/nF0SoTbT96

— Lucidvein (@Lucidvein) February 8, 2025

Florida To Invest In Bitcoin

Gruters introduced a legislative measure that would allow Florida to invest in Bitcoin using state funds to combat inflation.

The senator said that Senate Bill 550 proposed to permit Florida’s chief financial officer to use up to 10% of its funds to buy Bitcoin and other cryptocurrencies.

“The state should have access to tools such as BTC to protect against inflation,” Gruters said.

The bill aims to incorporate Bitcoin into state financial planning in the US, a legislative action that could reshape state authorities’ investment funds strategy and lead to other states adopting crypto.

Fighting Inflation With BTC

Gruters eyes that the proposed bill would help financial planners of Florida to hedge against inflation. 

“Inflation has eroded the purchasing power of assets held in state funds managed by the Chief Financial Officer, and this erosion diminishes the value of the state’s reserves, affecting the financial stability and economic security of this state, its taxpayers, and its residents,” Gruters said.

The senator explained in the bill that inflation has “eroded the purchasing power of assets” managed by the state’s chief financial officer, adding that the state is responsible for safeguarding “Florida’s financial resources” against inflation and economic uncertainties.

“Bitcoin is viewed as a hedge against inflation by sovereign nations and prominent investment advisors, including BlackRock, Fidelity, and Franklin Templeton,” he said.

Hence, the American senator explained that Florida should have access to tools like Bitcoin to protect state funds from inflation.

Impact On The State Economy

Once Gruter’s proposed legislation was enacted, it would be beneficial to the state in several ways.

Analysts said that investing in Bitcoin would diversify Florida’s state assets, adding that the state would incorporate in its portfolio an asset that historically provides high returns but with significant volatility.

Market observers added that this crypto legislation would help turn Florida into a blockchain hub that promotes cryptocurrency innovation, further establishing Florida as a crypto-friendly state.

Florida might become the model state for adopting Bitcoin in state financial planning, making BTC adoption in government finance a reality.

Crypto analysts also see that Florida’s success could encourage other states to follow its lead and start incorporating digital assets into their financial systems.

Featured image from Shutterstock, chart from TradingView

Core DAO and Element Wallet are collaborating to expand Bitcoin’s utility for holders, offering new avenues for interaction beyond simple storage. This partnership emphasizes user privacy while aiming to maximize the security of decentralized finance (DeFi) mechanisms like Bitcoin staking.

BeInCrypto discussed with representatives from both platforms to explore how user privacy and enhanced functionality in staking can create new opportunities for Bitcoin-oriented DeFi participation.

Expanding Bitcoin Use Cases

For 2025, the CORE team aims to develop new use cases for Bitcoin holders who wish to use their BTC rather than keep it perpetually stored. Core achieves this by enabling Bitcoin users to interact easily with DeFi.

“A lot of people have been holding Bitcoin over the years and are totally happy with that. I get it, myself included, but there are also a lot of people who want to actually do something with their BTC and not just hold it. They want to actually put it to work, bring it into DeFi, take out a loan on it, or lend it out and earn some yield. Core basically allows for whatever you want to do with your Bitcoin,” explained Dylan Dennis, Contributor at Core DAO.

Designed to enhance Bitcoin’s utility while preserving its decentralization and security, Core is a layer-1 blockchain that integrates with Bitcoin and offers EVM compatibility. Launched in January 2023, it has achieved a market capitalization of over $497 million.

The Core DAO, a decentralized autonomous organization, supports and develops the Core blockchain, pursuing security, scalability, and decentralization through community-driven collaboration.

Members of the Core DAO used the term BTCfi to describe decentralized financial services and applications built on a Bitcoin-based blockchain. This initiative combines Bitcoin’s security and reliability with innovative financial services found in DeFi platforms. 

BTCfi enhances Bitcoin’s value by expanding protection and increasing utility via on-chain yield and a comprehensive dApp ecosystem.

Meanwhile, Core’s EVM compatibility enables developers to use familiar Ethereum tools for interoperable dApps. These dApps increase Bitcoin’s versatility and cater to diverse user needs, from simple BTC staking to complex DeFi activities.

“Basically, Core was created by Bitcoiners. The whole point of Core is to scale Bitcoin and unlock new use cases for every kind of Bitcoiner, whether you’re someone who wants to take no new risk, and just keep your BTC in your wallet. Then on the other side, there’s this whole Bitcoin DeFi ecosystem, with 100+ Dapps, all BTC-based. Whatever you want to do with your BTC you could do it with Core,” Dennis said.

While exposing Core users to DeFi, Core also uses a three-in-one strategy to secure its high-throughput blockchain.

The Satoshi Plus Consensus for Ensured Decentralization

To stay true to Bitcoin’s core principles of decentralization and security, Core employs a mechanism defined as the Satoshi Plus Consensus. This method involves active collaboration from Bitcoin miners, CORE stakers, and Bitcoin Stakers. 

Bitcoin miners contribute to the security of the blockchain by delegating their Proof-of-Work (PoW) mechanisms to a Core validator. This non-destructive delegation of PoW allows miners to leverage their existing work without choosing between securing Bitcoin and Core.

Core’s security is also enhanced through a delegated Proof-of-Stake (dPoS) mechanism, which allows holders of Core’s native CORE tokens to participate in network security by delegating their tokens to validators.

Finally, Core’s Satoshi Plus consensus mechanism incorporates non-custodial Bitcoin staking. 

“With the non custodial staking, you can stake Bitcoin in your own wallet by putting a time lock on it. It’s called a time lock contract and it’s a Bitcoin native feature. You lock it in that transaction, you include the validator you want to delegate to, and for helping to decentralize and secure the core network, you get paid out in Core tokens for doing so without any new trust assumptions. So, something that helps to secure Core also helps with the whole mission, which is to unlock new use cases,” Dennis added.

Though Core emphasizes Bitcoin functionality for its holders, the Element Wallet is in charge of user privacy and the secure management of digital assets.

Addressing User Privacy and Asset Security

While the nature of the Core blockchain remains decentralized and transparent, the same does not apply to user details. 

Privacy is a crucial aspect for Bitcoin users and the crypto ecosystem in general, explained Bruna Brambatti, Marketing Manager at Element Wallet. 

“You’re going to see a lot of people that have random handles. They’re not using their profile picture. They are using an NFT. People like to be private and want to keep their money private. Even though we have this open space with the blockchain, we’re never going to know who the owner of that money in that wallet is,” she said. 

Element Wallet is a multi-chain crypto wallet for seamless asset management and DeFi access. Though it’s compatible with different crypto assets like Bitcoin and TRON, it was initially built for Core participants and acts as the first and primary interface for the Core blockchain.

To address user privacy concerns, Element Wallet uses various mechanisms to protect identity and financial information. Element’s messaging uses end-to-end encryption for user privacy. Only the recipient can decrypt messages, protecting content from third parties.

While Element does not store these messages’ content, it maintains a record of communication between users, excluding the actual message content. The messages themselves are stored locally on the users’ devices.

Element also integrates in-chat peer-to-peer (P2P) transfers. Users can send payments or payment requests within these chats, enhancing security and clarity by communicating directly with the recipient. This functionality provides added security and convenience, enabling direct trading within the application.

“We never, ever have access to anyone’s funds or to their seed phrases. We do believe that the owners should have the power in their hands, so they can do what they think is best with their assets and trust that they are theirs,” Brambatti added. 

To ensure that users can easily navigate the Core blockchain, Element Wallet incorporates user-friendly design strategies to simplify interaction.

Breaking Down Web3 Complexities

Core and Element representatives emphasized that community was at the heart of the blockchain’s success. To further cultivate user engagements, Core DAO focuses on breaking down onboarding barriers and facilitating user experience.

“We’re really focused on simplifying the kind of Web3 complexities that are often found in the space today. As we work closely with the Core DAO and the core team, and as the space evolves, we just find more opportunities to really simplify it and make UX be at the forefront of this,” explained Sean Schireson, Head of Product at Element Wallet. 

Element Wallet simplifies Core chain-related activities by providing a unique and comprehensive wallet that meets all user needs.

“The Element Wallet really enhances the user experience on Core chain, since it was built for the Core ecosystem. If you want to buy crypto, swap, non custodially stake your Bitcoin, you could do it all. If you want to chat with people, you could do it on there. So just trying to get the whole community onboarded, so that we could all be on this one Element Wallet and all transact together and just make the experience better for everybody,” explained Dennis.

The Core team created Sparks, a dynamic system for measuring contributions to the Core community’s growth to encourage user participation. Sparks track user activity and engagement within the Core Chain ecosystem. Based on their interactions and involvement, they are awarded to users and their teams. 

Daily Spark allocations are distributed based on activity level, with more active users receiving larger amounts. Users can also receive sparks by engaging with the Element Wallet. 

“What we want to do is make that entry point feel like a consumer app that you’ve used and loved before. And that’s really our gold element. We’re not trying to necessarily reinvent the wheel, but we’re definitely trying to have a new spin on an otherwise kind of saturated UX market. And so that’s where we’re really focused on there,” concluded Schireson.

This focus on user experience and community engagement aims to facilitate broader adoption and participation in the developing BTCfi sector.