As Bitcoin (Bitcoin) Continue to trade sideways in the range of USD 30,000 to USD 40,000, and new data on the bullish breakthrough potential is emerging.
Is Bitcoin silently preparing for a breakthrough like the fourth quarter of 2020?
Willy Woo, an analyst on the chain, expected Potential supply shocks in the Bitcoin market, as long-term holders continue to hold short-term supply of BTC. Woo stated in its July 2 newsletter that the process may result in more Bitcoins being withdrawn from circulation.
The analyst mentioned the ratio of Bitcoin held by strong hands to weak hands – also known as the Bitcoin supply ratio – and pointed out that the former is positive Absorb selling pressure The whale that has been dumping its cryptocurrency assets since February.
Woo wrote: “This reminds me of a supply shock that the market did not notice in the fourth quarter of 2020.” “When data shows that long-term investors are hoarding BTC quickly, experts are debating whether BTC is an inflation hedge in the post-COVID world .”
Prices then plummeted and quickly decoupled from their close correlation with stocks.
New active users rise
Glassnode is another data analysis service on the necklace, which has also promoted the booming adoption prospects of Bitcoin. The portal revealed that the Bitcoin network has an average of 32,000 new users every day, which is a new high in 2021.
The Bitcoin network user growth indicator last peaked in January 2018, reaching about 40,000, and then the price went down. It indicates that new users stopped entering the Bitcoin network because its price fell from a maximum of USD 20,000 in January 2018 to a low of USD 3,200 in December 2020.
“This is not the structure we are experiencing right now,” Woo explained. “New users are taking advantage of this opportunity to buy on dips; they will enter at the highest rate in 2021.”
Similarly, another example of on-chain data showing deviations in price behavior.
Bitcoin is currently staying below $34,000 at the time of launch, an increase of 17.52% from its lowest level of $28,800 on June 22.
At the same time, Petr Kozyakov, the co-founder and CEO of the encrypted payment network Mercuryo, believes that Ethereum may steal the limelight from Bitcoin in the short term because London hard fork approach.
“The proposed London hard fork upgrade and eventual migration to Ethereum 2.0 will help restore investor confidence,” he added. “Once the hype subsides, in the short to medium term, Bitcoin may rise to $50,000.”
Bitcoin withdrawal transactions hit a new year high
CryptoQuant Report Earlier on Tuesday, the net outflow of Bitcoin on spot exchanges broke the 60,000 mark for the first time in a year. At the same time, the total number of bitcoin deposits in spot exchange wallets fell below 20,000.
During the period when regulators strengthened their review of cryptocurrency trading platforms, the BTC withdrawal rate rose sharply. For example, the British Financial Conduct Authority (FCA) Prohibit Binance-the world’s most traded cryptocurrency exchange-operates regulated activities in the country “without prior written consent.”
Monday, Barclays Notice Its customers relied on FCA’s order as an excuse to indicate that they could no longer transfer funds to Binance. However, the London-based bank stated that customers can withdraw funds from Binance to their bank accounts.
Earlier on Tuesday, the People’s Bank of China also Take action against local companies Suspected of conducting cryptocurrency transactions in its daily business activities. Beijing effectively banned various cryptocurrency-related activities in May, effectively forcing the world’s largest cryptocurrency mining community in its region to either shut down or transfer its business abroad.
Generally speaking, the increase in Bitcoin withdrawal rates is seen as a trader’s intention to hold cryptocurrency, rather than trading it for other assets, including rival cryptocurrencies and fiat currencies. Therefore, as the total BTC withdrawals reach a one-year high, expectations are still higher than what Bitcoin is doing for the so-called “Holding “feeling.
Do not.Looks like retail is back #HODLing!
-Johan Kirsten (@ JohanKirsten1) July 6, 2021
However, the total Bitcoin reserves held by exchanges have remained relatively stable since May, which shows that the latest surge in withdrawals as of July 7 has little impact on the overall exchange balance.
It is worth noting that the exchange’s BTC balance may vary greatly due to its geographical advantages.
For example, trading platforms and Chinese traders associated with China have reported that their Bitcoin balances have fallen. These include Binance, whose BTC reserves decreased by 7,214.97 units last week, and Huobi, which processed 4,398.63 BTC withdrawals during the same time period. The OKEx BTC balance decreased by only 1,357.53 BTC.
However, Kraken, headquartered in the United States, has added 6,751.98 BTC to its vault in the past 7 days, the highest among non-Chinese exchanges, while Coinbase reserves have increased by 168.88 BTC.
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