• This article looks at the Bitcoin active addresses metric, which measures daily transaction activity on the chain.
• Recent data suggests that demand for Bitcoin has been returning, but the rise has been slower than what previous cycles saw at a similar stage.
• The metric hasn’t moved much in recent weeks, though there was an increase with the latest rally in the price of Bitcoin.
On-chain data shows demand for Bitcoin has been returning recently, but the rise has been slower than what previous cycles saw at a similar stage. As pointed out by an analyst in a CryptoQuant post, the market activity rapidly changed after the bottom formed during the previous cycles. The relevant indicator here is the „active addresses,“ which measures the daily total amount of Bitcoin addresses that are participating in some transaction activity on the chain.
The metric only measures unique addresses, meaning that if an address takes part in multiple transfers in a single day, it’s still counted only once. The indicator also accounts for both senders and receivers in this measurement. When the value of this metric is high, it means a large number of addresses are making transactions on the network right now. Such a trend suggests that cryptocurrency is actively attracting users to trade on its chain currently. On the other hand, low values imply not many users are making transfers on blockchain at moment. This kind of trend can suggest that demand for asset is low currently.
Here is a chart that shows trend in Bitcoin active addresses over last few years: Looks like value of metric hasn’t moved much in recent weeks | Source: CryptoQuant As shown above graph, Bitcoin active addresses had come down to relatively low value during bear market, but recently some improvement has been registered in indicator. Furthermore when price began to move sideways again following crash active adresses also once again sunk down and have seen increase with latest rally price of bitcoin however rise still not too significant yet compared to other times when market was coming out bearish period before bull run started properly taking off again as investors rush back into BTC markets looking to take advantage profits from volatility or accumulation itself depending personal preference strategies each individual bring table with them when trading start up again properly after long periods consolidation occur where volume drops off significantly so does number unique adresses participating transactions blockchain as well often lead lower prices due lack buyers willing hold support level causing dump sell pressure overwhelm order books causing pullback retrace until more buyers enter market cause rebound recover new higher prices being reached soon afterwards skyrocketing prices even higher levels then before due FOMO effect fear missing out kick investors seeking jump bandwagon chase returns frequently gained these situations where everyone wants piece action leading increased competition bidding wars pushing bids up ever higher as people race buy coins while they still cheap enough jump profiting big time result when market eventually turn bullish mode having good understanding technical analysis fundamental knowledge key success here regardless strategy employed hoping make money crypto space so important remember do own research before investing anything signifcant size risk losing funds process if done correctly should always end profit end user most times unless bad luck strikes unexpected surprise happens along way preventing expected outcome originally planned reaching desired goals which set begin within first place hope break through any barriers hindrances come way while climbing ladder success path chosen chosen carefully best judgement possible time ready willing put work effort required get ahead game become successful trader long term basis since without dedication determination nothing achieved life regardless field career chosen pursue follow dreams passions strive reach highest levels achievements