Growth in the Number of New Bitcoin Addresses and Its Impact on the Market
Date: 2023-10-05 Author: Dima Zakharov Categories: CRYPTO PAYMENTS
The Growth of New Bitcoin Addresses Brings Hope to Crypto Investors
October has started with good news for those following the cryptocurrency market. The price of Bitcoin (BTC) has returned to the $27,000 level, sparking optimism among crypto enthusiasts. This rise is seen as a promising start to the month, known for its historical tendency toward bullish trends and nicknamed "Uptober" in the crypto community.
However, it's not just the price of BTC that is on the rise amid positive news. Fundamental indicators are also catching the attention of investors. Blockware Solutions, a company specializing in cryptocurrency mining research, has provided data showing that over the last 30 days, approximately 550,000 new Bitcoin addresses have been created daily. This increase in activity holds particular significance as it contradicts conventional perceptions of bear markets.
Prominent crypto analyst @MitchellHODL highlighted this unusual dynamic, calling it an "unprecedented level of on-chain activity for a bear market". He also noted that the last time such activity was observed was during the peak of the two previous Bitcoin bull cycles.
The growth in the number of Bitcoin holders is becoming an important factor. Analytical firm Santiment reported that addresses with balances ranging from 10 to 10,000 BTC have accumulated a total of 13.03 million coins. This indicates growing confidence in the future price prospects of Bitcoin. Santiment analysts even speculate on the possibility of a return to the $30,000 level if these addresses refrain from selling their bitcoins.
Furthermore, changes are occurring in the market that favor a bullish trend for BTC. Reports from the Cryptoquant platform show that Bitcoin reserves on popular centralized exchanges like Coinbase, Kraken, and Gemini have decreased by over 50%. This could suggest that investors are increasingly opting to hold their bitcoins in personal wallets, anticipating price growth.
Interest is not only growing in physical bitcoins but also in derivative instruments. Open interest in BTC has reached its highest levels since November 2022. Despite a correction in August 2023, the futures market remains stable, indicating unwavering trader enthusiasm.
In summary, October has begun on a positive note for the cryptocurrency market. Supported by stable fundamental indicators, investors anticipate a rise in BTC price in the fourth quarter of 2023, with a target of $30,000. The start of a new month, a new quarter, and a new financial year in the United States could lead to an influx of capital into various asset classes, including cryptocurrencies.
At the time of writing this review, the leading cryptocurrency, Bitcoin, is trading at $27,700.
