Bitcoin’s Price and Network Activity: One is Faster

Several Bitcoin (BTC) on-chain indicators remain unfavorable.
The disparity between active addresses and bitcoin’s price has gotten rather large.
Metrics such as network volume may be used to calculate how much money the addresses spend.

Several on-chain indices for Bitcoin (BTC) remain unfavorable, implying that a continuation of the recent price rebound may need increasing demand and network fees, according to Glassnode.

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Sideways rise in transactional demand, active Bitcoin addresses being in “a well defined downward trend,” and decreased network costs were cited by analysts as reasons to dampen investors’ enthusiasm.

In the realm of cryptocurrency, there are several relevant measures that can be used to assess price behavior. However, looking at these many data can be daunting, especially for those who are new to the crypto industry. The daily active addresses are a very valuable measure for analyzing Bitcoin (DAA).

A Bitcoin address is a unique identifier for your wallet that you may use to conduct Bitcoin transactions. Bitcoin active addresses varied somewhat. The gap between active addresses and bitcoin’s price has grown rather significant, which is maybe surprising considering that the two soared and fell in lockstep for much of 2018.

However, while the disparity between the two measurements is increasing, it is not the first time this has happened. For example, active addresses increased significantly over the almost two-year bear market that lasted from 2014 to early 2016, implying that active addresses may not be the best predictive fundamental statistic for bitcoin’s price.

Because active addresses only indicate how many accounts are actively making transactions, other metrics like network volume and TAAR can be used to determine how much money the addresses are spending.

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Godfrey Mwirigi

Godfrey Mwirigi is an enthusiastic crypto writer with an interest in Bitcoin, blockchain, and technical analysis. With a focus on daily market analysis, his research helps traders and investors alike. His particular interest in digital wallets and blockchain aids his audience in their day-to-day endeavors.