The BTC network momentum stalls in recent months and some see this trend as a very concerning sign for the long-term trend. However, analysts say that there’s no need for concern as there are trends that are suppressing the metric so let’s find out more in our latest bitcoin news.
Despite the resilience in bitcoin’s price which can be seen in the most recent price action and the macro rally from the March lows, the BTC network momentum stalls. This metric was created by the on-chain analyst Phillip Swift and it “looks into the value transmitted through the BTC-blockchain denominated in BTC Value plotted against the price.” The data suggest that the networking momentum is around the lows seen at the end of 2018 when the coin was trading at $3,150 but what is even worse is that the metric is far below the highs of 2019.
BTC Momentum suffers from changes of on-chain behavior. We're in an era where layer-2 is dominant, also 2017 had huge BTC movements for ICOs including syndicate buys pooling BTC, increasing the volume, 2020 it's done on ETH and exchanges. Time to deprecate. https://t.co/YvD2Y2Bw38 pic.twitter.com/B6Jx3tVxmT
— Willy Woo (@woonomic) October 7, 2020
According to Willy Woo, the prominent on-chain analyst, there’s no need for concern for the leading cryptocurrency. he noted that the behavior of Bitcoin users is affecting the network momentum metric where it is most likely to remain low. He noted that this year there were many transfers that were taking place through Ethereum or exchanges:
“BTC Momentum suffers from changes of on-chain behavior. We’re in an era where layer-2 is dominant, also 2017 had huge BTC movements for ICOs including syndicate buys pooling BTC, increasing the volume, 2020 it’s done on ETH and exchanges. Time to deprecate.”
1/ New #bitcoin addresses were absolutely off the charts last week.
The backstory is bullish and intriguing — a unique view on a new bull market catalyst.
— Cole Garner (@ColeGarnerBTC) October 5, 2020
Other on-chain metrics for BTC are still forming bullish signs despite the loss of the networking momentum. Cole Garner shared the data from GLassnode where we can see that the number of new bitcoin addresses that are created each day, surged to more than 20,000 but this metric usually sits between 5000 and 10,000. Garner continued:
“Bottom line — this news is incredibly bullish, and appears to have fundamental confirmation. I definitely I expect more shakeouts and sideways price action moving forward. But I’m fundamentally bullish on $BTC. And I think hodlers will be grinning by Christmas.”
He also mentioned that China is now promoting bitcoin, Ethereum, and DeFi on TV and the state broadcaster has millions of viewers around the country. Around the same time, the state media shared reports about cryptocurrencies being the best investment for this year.
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