- Bitcoin network activity rebounded and could hit one million active addresses in June.
- There was increased interest in inscriptions, but warning signs emerged as the MVRV ratio dropped.
Bitcoins [BTC] Activity rebounded after a recent slump, with data from Santiment suggesting the network’s number of active addresses could hit one million in June 2023.
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📈 May’s worryingly low #bitcoin address activity is finally starting to bounce back. In order for #cryptoassets to experience sustained rallies, increasing utility is required. Keep an eye on if $BTC can start June with 1 million or more daily active addresses. https://t.co/LSa2slHWgt pic.twitter.com/zqTH9KGIqc
— Santiment (@santimentfeed) May 27, 2023
Read Bitcoins [BTC] Price prediction 2023-2024
Interest in inscriptions is growing
One of the main reasons for the high level of activity on the network is the increasing interest in Bitcoin inscriptions. Data from Dune Analytics showed that the number of daily enrollments has increased significantly from 150,000 to 200,000 in the past few days.
Source: Dune Analytics
Additionally, the vast majority of inscription activity stems from demand for text-based inscriptions, which accounts for about 90% of total activity.
Coupled with the increased interest in inscriptions, interest in holding bitcoin has increased significantly. Glassnode data suggests that the number of non-zero addresses hit an all-time high on May 28.
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📈 #Bitcoin $BTC The number of non-zero addresses just hit a new high of 47,180,069
View metric:https://t.co/VtoChZbLsa pic.twitter.com/124aCwyEd4
— Glassnode Alerts (@glassnodealerts) May 28, 2023
Additionally, Bitcoin’s MVRV ratio, which measures the average profit or loss across all holders, has fallen. This indicated that bitcoin holders were becoming less profitable. If this trend continues, it could potentially lead to a decrease in selling pressure from holders.
While these developments bode well for Bitcoin, some warning signs have also surfaced. BTC’s long/short difference has decreased, suggesting that the number of new addresses is outstripping old addresses.
It’s worth noting that new addresses are more inclined to sell their holdings, potentially leading to price volatility and challenges to Bitcoin’s stability in the future.
Source: Santiment
Bitcoin traders turn positive
Despite these potential concerns, the total number of long positions for BTC has increased significantly over the past few days, according to Coinglass. This rise points to a growing optimistic mood among investors, which may be due to positive market indicators and the prospect of future price increases.
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One reason for the increase in long positions in favor of Bitcoin could be the cryptocurrency’s falling implied volatility. Decreasing volatility often tempts investors to take cheaper positions in anticipation of a period of price stability or upward movement.
Source: The Block
According to CoinMarketCap, Bitcoin was trading at $27,214.77 at press time, up 1.89% over the past 24 hours.
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