“Extraordinary” on-chain indicators may mean the return of Bitcoin and Ethereum bull market-new report

Bitcoin (Bitcoin) And ether (Ethereum) Has begun to show a “significant” bullish divergence, which echoes the beginning of a bullish price trend.

This is based on the latest data collected by the on-chain analytics company Glassnode this week.

BTC and ETH data simulation “Mid and late 2020”

In its latest weekly report, “The Week On-chain”, Glassnode revealed that although the price trend is still calm, on-chain indicators indicate that it is likely to lag behind more bullish sentiment.

“As Bitcoin and the broader cryptocurrency market move higher, Bitcoin and Ethereum continue to form significant on-chain divergence,” the report concluded.

“Relative to the bull market highs, on-chain activity on both chains remains calm, and even if price momentum continues to rise, the bullish trend in supply dynamics is still in play.”

Signs are everywhere-from burgeoning network participation to record transaction value, Bitcoin and Ethereum are by no means quiet behind the scenes.

The active entities on the Bitcoin blockchain are particularly noteworthy. Although the price is close to $50,000, it is still one-third lower than the historical high, but it is growing rapidly.

The analyst added: “It’s worth noting that the current activity on both chains is similar to the stable pre-bull accumulation range established in mid-to-late 2020.”

Annotated chart of Bitcoin activity entities. Source: Glassnode

The difference between these on-chain trends and price behavior is already obvious Well known And it is similar to the cryptocurrency market in the fourth quarter of 2020, just before the recent bull market really took off.

“While the difference between prices and on-chain activity is historically abnormal for a full-blown bull market, it is not uncommon for pre-bull market and pre-supply squeeze dynamics,” the report continued.

“These periods are usually accompanied by the end of bear market accumulation. The investors who remain are the strong, those with the highest convictions.”

Bitcoin token transfers hit a two-year high

One nuance focuses on the number of transactions. These are also nearly 40% lower than the peak, but in terms of BTC transfers, Bitcoin this month has its biggest week in two years.

related: Bet on the Bitcoin bull market?Not in September, the BTC price data shows

“These transactions did not come from exchanges,” commented Ki Young Ju, CEO of the analyst firm CryptoQuant, and offered several possible explanations for these numbers.

Glassnode concluded that if the status quo continues, the outlook for BTC and ETH price trends is optimistic, adding that only “active sales” of tokens that have not moved for a long time will constitute a bull market signal failure.