Bitcoin, the most important cryptocurrency has rallied strongly off the underside, reaching above the $23k mark. So does this indicate the start of the bull market?
Nicely, Glassnode in its newest weekly ‘On Chain’ report on 1 August shed some perception on this narrative. The report assessed if the present market momentum was a vote to the bear market rally.
Not-much to have a good time
Bitcoin would want to do extra to flee the looming bear lure as per the report.
BTC’s variety of lively addresses remained inside a well-defined downtrend channel within the graph beneath.
Supply: Glassnode
Notably, the October-November all-time excessive (ATH) reached a considerably decrease peak than the April 2021 ATH. Ergo, suggesting a serious washout of customers had occurred, and demand didn’t fairly comply with via. On this regard, the report asserted,
“With exception of some exercise spikes larger throughout main capitulation occasions, the present community exercise means that there stays little inflow of recent demand as but.”
Glassnode within the graph famous this as a “low bear market demand profile” which has been in impact basically since final December.
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Two extra indicators painted the same sketch- Particularly, the variety of transactions per second and the entire transaction charges.
Typically, a bull market showcases elevated price charges. Nonetheless, that’s actually not the case right here. The graph beneath noticed no notable uptick in charges. Herein, the on-chain transaction charges, firmly inside a bear market territory, noticed solely 13.4 BTC in whole charges paid per day.
For context, when costs reached ATH final April, day by day community charges topped 200 BTC.
Supply: Glassnode
Even the demand for on-chain transactions had dried up, just like the one established within the 2018-2019 interval.
After the preliminary wash-out and demand destruction in Might 2021, transactional demand traded sideways to barely decrease. It was barely capable of overcome the stated knockout final 12 months.
Supply: Glassnode
Within the aforementioned state of affairs, ‘solely the steady base of upper conviction merchants and traders stay,’ Glassnode acknowledged. General, the report concluded,
“The Bitcoin community stays HODLer dominated, and as but, there has not been any noteworthy return of recent demand, as seen via the lens of on-chain exercise.”
Having stated that, one side that did see a ray of vivid sunshine was the BTC Lightning Community (LN). These channels continued to print new all-time highs.
Supply: Glassnode
Furthermore, the entire LN public capability reached 4,405 BTC, which is a rise of 19% during the last two months, regardless of the prevailing bear market.
