The number of active users, transferred on-chain value and transaction fees in the Bitcoin and Ethereum networks updated lows after the May correction. These observations were shared by Glassnode analysts.
#Bitcoin on-chain activity has fallen dramatically this week, returning to levels not seen in 1yr.
Simultaneously, a seismic shift is underway in the #Bitcoin mining markets, as hash-rate falls and miners ramp up spending.
Read more in The Week On-chainhttps://t.co/nolMIQaFGK
— glassnode (@glassnode) June 21, 2021
The indicator of active bitcoin addresses fell from recent peaks by 24% to 884 thousand. The decrease in the same metric on the Ethereum network turned out to be even more dramatic – by 30%, to 474 thousand.
Dynamics of active addresses in Bitcoin and Ethereum networks. Data: Glassnode.
The total volume of the transferred on-chain value in the blockchains of the first and second cryptocurrencies decreased by 63% and 68% – to $ 18.3 billion and $ 5 billion, respectively.
Dynamics of the transferred on-chain value in the Bitcoin and Ethereum networks. Data: Glassnode.
Commissions for priority inclusion in the block in the bitcoin network against the background of the release of mempools decreased to 2020 values. The daily rate of transaction fees fell to 29.6 BTC ($ 1.2 million), its share in miners’ income fell to 4%.
Dynamics of total paid transaction fees in the bitcoin network. Data: Glassnode.
On the Ethereum network, daily transaction fees have dropped to 1,900 ETH (~ $ 4.34 million). The last time such values were observed on the eve of the “DeFi Summer” 2020. The share of commissions in miners’ income dropped to 10%.
Dynamics of the transferred on-chain value in the Bitcoin and Ethereum networks. Data: Glassnode.
In the context of the distribution of coins, analysts found a similarity between the current situation and the events of 2017. In the chart below, you can see the long-term holders’ transition to accumulation, which was typical after the formation of a peak during the previous cycle of the bull market.
The turning point in their actions occurred, despite the fall in the price of bitcoin below the cost of buying some of the coins. Of the additional 5.25% of the market supply purchased over the past two months, about 1.5% of the coins are held with an unrealized loss.
Dynamics of the distribution of the aggregate market supply of bitcoin between short- and long-term investors, as well as the relative share of the profitability of their investments. Data: Glassnode.
Glassnode drew two conclusions:
the demand for on-chain transactions is extremely low, which can be considered a bearish factor;
long-term investors do not leave the position at current prices (neutral-bullish factor, according to analysts).
The experts also provided a chart of the bitcoin hash rate. According to their estimates, over the past two weeks, the volume of computing power has collapsed by 16% – from 155 EH / s to 125 EH / s (at least since mid-2020).
Hashrate dynamics in the bitcoin network. Data: Glassnode.
This trend coincided with the sale of coin stocks to cover the operating costs of miners for relocation, selling equipment, or going out of business. Over the past two weeks, the daily sales of this category of market participants amounted to 4-5 thousand BTC.
Dynamics of changes in the net position of bitcoin miners. Data: Glassnode.
According to CryptoQuant, the day before the spot exchanges received the maximum number of coins since March 2020.
Analyst Michael van de Poppe allowed the price of bitcoin to drop to $ 24,000 when the May lows are broken.
#Bitcoin is still acting in support here, with the crucial breaker at $35.5K.
If this support doesn’t hold, I’m seeing $24K as the next area. pic.twitter.com/kk2CJixUyF
— Michaël van de Poppe (@CryptoMichNL) June 22, 2021
On June 16, the head of cryptocurrency hedge fund Pantera Capital Dan Morehead said that now is a great time to buy digital gold.
Tim Draper confirmed his forecast for Bitcoin to rise to $ 250,000 by the end of 2022 or early 2023, despite sharp price fluctuations.
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