Glassnode data reveals bullish trends for Bitcoin amidst latest rally

Bitcoin had one of its best weeks in history, closing up 35.8%.

Bitcoin’s monthly average transaction count has hit 309.5,000 per day — its highest level since April 2021, according to on-chain analytics firm Glassnode. Despite the high price development, the proportion of “hot coins” is still close to cycle lows This suggests that most older coin owners are not motivated to take profits.

But with the price of bitcoin now appearing to be heading towards the $30,000-$32,000 range, does the recent rally mean we are out of bear market territory?

Glassnode data looks bullish

(Source: Glassnode)

For the week of March 20, the monthly average of transactions hit 309.5,000 per day – the highest level since April 2021 and well above the yearly average. Less than 12.2% of all days saw higher transaction activity for Bitcoin — a positive indication as this metric is typically associated with rising adoption rates, network effects, and investor activity.

(Source: Glassnode)

Glass Node estimates that the number of distinct new entities operating on the blockchain is the best measure of unique new users. Their analysis shows that this metric hit 122,000 new entities per day, but only 10.2% of days had higher adoption rates for new users — which happened during the 2017 peak and 2020-21 bull run.

Bitcoin miners are also seeing a surge

Miners are among the main beneficiaries of this influx, with their total earnings rising to $22.6 million per day. For the week of March 20, miner earnings surged to the highest level since June 2022, significantly beating the yearly average.

Similar to the previously mentioned activity models, this trend is often seen at transition points to a cheaper market.

(Source: Glassnode)

Mining revenue in the green

Miners are without a doubt one of the lifelines of the crypto ecosystem. However, rising mining activity is also leading to grid congestion and gas tariffs, which are typical harbingers of more constructive markets.

While high network fees can make small transactions more expensive, they benefit miners, who receive these fees for securing the blockchain.

According to on-chain data, miner revenue has returned to its highest level since June 2022 at $22.6 million/day — suggesting Bitcoin is back in bull territory, Glassnode says. Despite the strong price action, the proportion of “hot coins” is still close to cycle lows – suggesting that most older coin holders are not motivated to take profits.

(Source: Glassnode)

Glassnode’s report also analyzed Bitcoin’s MVRV (Market-Value-to-Realized-Value) ratio, which measures the unrealized profit multiple within the coin supply. The ratio has climbed to 1.36 after surpassing $27,000 this week, returning to its “neutral zone”. This suggests that prices are no longer much discounted compared to the average market cost on the chain.

(Source: Glassnode)
(Source: Glassnode)

Ultimately, Glassnode concludes that the future looks bright for Bitcoin:

“Bitcoin investors have enjoyed one of the strongest one-week gains on record amid stress, consolidation and liquidity injections across the global banking system. Multiple on-chain indicators suggest the bitcoin market is transitioning out of conditions historically associated with deep bear markets and back to greener pastures.”

Posted in: Bitcoin, Analysis

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