Blockchain analytics provider Glassnode has depicted a bearish scenario for Bitcoin as on-chain metrics suggest increased selling pressure is imminent.
In its weekly analytics report released on February 21, on-chain metrics firm Glassnode said that bitcoin bulls are “facing a number of headwinds,” referring to increasingly bearish network data.
Researchers cited general weakness in major markets combined with broader geopolitical issues as the reason behind the current risk-off sentiment towards crypto assets.
“The weakness in both Bitcoin and traditional markets, reflects the ongoing risks and uncertainties associated with the Federal Reserve’s expected March rate hike, and concerns about conflict in Ukraine, as well as growing civil unrest in Canada and elsewhere.”
He. She added That as the downtrend deepens, “the possibility of a more sustainable bear market is also expected to increase.” Bitcoin is currently trading 47% down from its all-time high in November and has been trending lower for the past 15 weeks.
One of the characteristic signs of a . is a lack of activity on the chain bitcoin bear market. The number of titles or entities currently active in the lower bound of a bear market channel depicting on-chain activity during periods of sideways or downtrend markets, indicating a decline in demand and interest.
Glassnode reports that about 219,000 addresses have been emptied over the past month, indicating that it may be the beginning of a period of user flows from the network.
I calculated the short-term bearer realized price based on the total cost of $47,200, which means that the average loss at current prices is about 22% for those who are still holding the asset.
“The longer investors stay underwater in their position, and the more they fall into an unrealized loss, the more likely those coins will be spent and sold.”
There were several other measurements of the long and short positions on the chain that culminated in the conclusion that there are a total of 4.7 million BTC currently underwater. It added that more than half, or 54.5%, was owned by those in the short-term (less than 155 days), “who are statistically more likely to spend it.”
Crypto Twitter has also been mired in bearish sentiment over the past few days, Bitcoin fear and greed index Currently score 20 – “Extreme Fear”.
Not everything in cryptography will last.
Quick thoughts on the fallout from a bear market:
– Jason Choi (@mrjasonchoi) February 21 2022
At the time of writing this report, Bitcoin prices It is down 6% in the past 24 hours to trade at $36,738 according to CoinGecko. Bitcoin is now priced near its 2022 low, which was just over $35,000 on January 23.
On the positive side, on February 19 Cointelegraph reported that Bitcoin inactive supply near record levels With more than 60% of BTC remaining unspent for at least a year. 3AC Co-Founder Zhu Su hung That many people who bought bitcoin in 2017 and 2018 are still hoarding, adding, “According to the story, many of these people are staying humble this time around and buying every month no matter what happens.”
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