Cointime

Download App
iOS & Android

Update On $BTC Price & Network Trends

Validated Individual Expert

2023 has the potential to be a good year for BTC. In this analysis, I look at various long-term data and indicators. Most of the charts below come from Looknode and are supplemented by data from Buy Bitcoin Worldwide.

Let’s begin with growth in new addresses. For easier interpretation, I smoothed the chart below a bit (14-day SMA).

Since the beginning of the year, we have seen an upward trend that is characterized less by individual, large spikes and more by its sustained upward momentum.

Individual strong upward swings in new BTC addresses have mostly occurred in recent years after price crashes. Constant increases like the current one, on the other hand, were accompanied by long-lasting price increases in Bitcoin.

Let’s go into more detail and take a look at the active addresses (the chart shows 14-day SMA).

It is noticeable here that the number of active Bitcoin addresses fell slightly over 2022, apart from a few fluctuations. This changed at the beginning of 2023 and we are seeing significant and sustainable growth here.

This is underscored by the growth in addresses holding more than 1 BTC.

Throughout the past bear market, many have made use of the low prices to buy more Bitcoin. Especially just before the turn of the year, the growth of these wallets was enormous and although the prices have recently risen sharply, the momentum continues.

The changed market environment is also reflected in various Bitcoin indicators.

After spending around 6 months there, the MVRV-Z score has clearly left the bottom area (green) behind. As can be seen from the chart, there is still a lot of upside potential before we reach bubble (red) territory. It also shows that this bull cycle is still in its early stages.

The positive market development is also reflected in investor sentiment.

The Fear & Greed index is currently in the ‘Greed’ area with 58 out of 100 points. Although we still have the potential for further price increases here, it looks like a sharper price correction is definitely in the cards.

Bitcoin cycle repeat chart also indicates a correction is possible.

Bitcoin cycle repeat chart

Finally, let’s take a look at the percentage of Bitcoin investors who are currently making a profit.

Around 73% of all Bitcoin investors are currently making a profit with their investments. That sounds like a lot, but as the chart shows, the peak of a cycle is only reached at around 90%.

Let’s summarize these findings.

All on-chain macro indicators and cycle valuation metrics for Bitcoin listed in this analysis paint a positive picture.

It looks like we are clearly out of the bear market and in the early stages of the next bull cycle. Both address growth, user sentiment, and various indicators that offer orientation in the current cycle show a sustained upswing. This is fundamental — it is not an outlier, but a long-term positive trend that forms the basis of any bull cycle.

Even if the current picture is a very good one, caution should be exercised. The experience of previous cycles shows that the positive momentum can quickly rebound. In fact, the months following past bear cycles are often characterized by months of sideways momentum. As always, it is difficult to say how things will continue in the coming months and will be significantly influenced by various macro developments in the global economy and global politics.

Disclaimer: Nothing in this article is financial advice!

Read more: https://medium.com/coinmonks/update-on-btc-price-network-trends-77e8bf7e92ee

Comments

All Comments

Recommended for you

  • David Sacks: The U.S. government’s premature sale of Bitcoin has cost U.S. taxpayers more than $17 billion

    White House AI and cryptocurrency chief David Sacks posted on social media, "The early sale of Bitcoin by the US government has cost American taxpayers over $17 billion. Now, the federal government will develop a strategy to maximize the value of its Bitcoin holdings."

  • David Sacks: The U.S. government will not acquire other crypto assets for strategic reserves except for confiscated assets

    White House AI and cryptocurrency chief David Sacks posted on social media that President Trump's executive order also established the U.S. Digital Asset Reserve, which includes digital assets other than Bitcoin confiscated in criminal or civil litigation. In addition to assets obtained through confiscation procedures, the government will not acquire other assets for the reserve assets. The purpose of the reserve is to manage government digital assets under the leadership of the Treasury Department.

  • Forbes reporter: Trump's executive order will establish two types of digital asset storage mechanisms

    Forbes reporter Eleanor Terrett wrote on X platform that Trump's executive order will establish two different digital asset storage mechanisms: Bitcoin Strategic Reserve and Digital Asset Reserve. The Bitcoin Strategic Reserve will contain approximately 200,000 BTC obtained through criminal and civil forfeitures, with the government authorized to explore ways to acquire more bitcoin without increasing the taxpayer burden. The Digital Asset Reserve will include other digital assets such as XRP, ADA, ETH, and SOL, but the government will not actively seek to purchase these assets. The executive order also requires a comprehensive audit of all digital assets held by the government. According to David Sacks, the purpose of the reserves is "responsible management of government digital assets by the U.S. Treasury Department."

  • In the past hour, the entire network has liquidated 152 million US dollars, mainly long orders

    Data shows that in the past 1 hour, the entire network has liquidated $152 million, with long positions liquidated $119 million and short positions liquidated $33.3292 million, with the main liquidation being long positions. Among them, ETH liquidated $12.5215 million and BTC liquidated $88.1221 million.

  • August Completes $10 Million Financing, Led by Dragonfly Ventures

    On March 7th, it was reported that the cryptocurrency broker August completed a $10 million financing round, led by Dragonfly Ventures, with participation from Foresight Ventures, Standard Chartered Bank, and 6th Man Ventures. The funds raised will be used to develop marketing strategies, hire more employees, and continue to develop new technologies. August is a brokerage company focused on cryptocurrencies, aiming to connect customers with lending cryptocurrencies and providing derivatives and token trading on the DeFi network, including Aave, Morpho, and Uniswap.

  • Hong Kong SAR Legislative Council Member Wu Jiezhuang: Hong Kong does not have an official currency

    Hong Kong Legislative Councilor Wu Jiezhuang said that Hong Kong does not have an official currency. Some citizens and Web3 practitioners have asked me about someone impersonating the Chief Executive to post on the X platform that they will launch the Hong Kong Coin on the Solana chain (launch of the National Hong Kong Coin). The government has sternly clarified that the information is absolutely false and intentionally deceptive. Please remember to be careful and not to mislead and fall victim to fraud.

  • Trump family’s WLFI project purchased $25 million in WBTC, ETH and MOVE tokens

    According to Arkham monitoring data, the wallet of the Trump family's project World Liberty Fi (WLFI) has just transferred 25 million USDC to an independent contract. The contract then purchased $10 million worth of ETH, $10 million worth of WBTC, and $1.5 million worth of MOVE tokens. After the purchase was completed, these assets were transferred back to WLFI's main wallet. This move is seen as a signal that the Trump project is further entering the cryptocurrency market, although its specific strategic intent is not yet clear.

  • BTC falls below $67,000

    market shows BTC has fallen below $67,000, currently reporting at $66,987.51, with a 24-hour increase of 0.41%. The market is experiencing significant fluctuations, please be prepared for risk control.

  • BTC breaks through $67,000

    the market shows BTC has broken through $67,000 and is currently trading at $67,011.99, with a 24-hour decline of 0.26%. The market is volatile, so please be prepared to manage risks.

  • Crypto Options Traders Bet on Bitcoin to Reach Fresh Highs by End of November

    According to Bloomberg, options traders in the crypto market are increasingly betting on bitcoin reaching new highs by the end of November. The $75,000 strike price has the highest open interest for options expiring on November 8, indicating a significant area of focus for the market during that time. Despite the upcoming U.S. presidential election, some traders believe that bitcoin will surpass its previous highs in the coming weeks. The rise in stablecoin liquidity and bitcoin transactions in October may contribute to this bullish sentiment.