Although Bitcoin prices have rebounded by 15 percent over the past week, further network demand is required to maintain further price gains, according to measures.
With key on-chain metrics for Bitcoin (BTC) still in a bearish zone, Glassnode asserts that a continuation of the recent price rebound will require higher network usage and fees.
Glassnode, a blockchain intelligence organisation, published on August 1 a study titled The Week On Chain in which it stated that market growth over the last week was mediocre.
In it, analysts cited sideways growth in transactional demand, active Bitcoin addresses continuing in “a well-defined downward channel,” and decreased network fees as reasons to dampen investors’ enthusiasm regarding the recent 15 percent increase in BTC price. According to CoinGecko, Bitcoin has declined 2% over the past 24 hours, trading below $23,000 to $22,899.
Attention now turns to whether this is a bear market rally, or whether the fundamentals are following through in support.
Read more in The Week On-chain 👇https://t.co/taOkbeVlyv
— glassnode (@glassnode) August 1, 2022
The paper begins by describing the characteristics of a bear market, such as a decrease in on-chain activity and a shift from speculative speculators to long-term holders. It suggests that the Bitcoin network continues to exhibit each of these characteristics.
According to Glassnode, a reduction in network activity might be read as a lack of new demand from speculative traders over long-term holders (LTHs) and investors with a strong belief in the network’s technology. The report reveals: ava find professional for windows 10
With the exception of a few activity surges around large capitulation events, the present network activity indicates that there has been no increase in fresh demand.
In contrast to the previous week, when a considerable level of demand appeared to be formed at $20,000 for BTC, so establishing a floor, the additional demand required to sustain any future price increases is not evident. Glassnode refers to the gradual fall of active addresses as a “low bear market demand profile” that has largely been in effect since December.
the one established for the period of 2018-2019. Similar to the previous cycle, network demand diminished following the all-time BTC price high in April 2021. Prior to the following November, there was a substantial resurgence in demand as prices reached a new ATH.
However, since November of last year, demand has been on a declining trend, with a significant decrease during the huge liquidations in May. codigo de activacion razer
The Bitcoin network remains controlled by HODLers, and there has been no notable return of new demand.
Glassnode noted that demand from parties other than Bitcoin aficionados is so low that network costs have entered “bear market territory.” During the previous week, daily fees totaled barely 13,4 BTC. In contrast, when prices reached ATH in April 2017, network fees exceeded 200 BTC per day.
Assuming that fee rates climb by a significant amount, Glassnode thinks that this might indicate a surge in demand, thereby sustaining a “positive structural shift” in Bitcoin network activity.
While we have not yet observed a significant increase in fees, keeping an eye on this statistic is likely an indication of economic recovery.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.