Key Points
- Bitcoin’s active addresses have declined, raising concerns among analysts.
- Cryptoquant analyst Burak Kesmeci suggests 350k new addresses are crucial for Bitcoin’s sustained uptrend.
Bitcoin [BTC] has seen a significant rise over the past month, reaching a high of $69k after a local low of $58k.
However, there has been a noticeable drop in Bitcoin’s daily active addresses. The number has dipped from 1.1 million to 980k, sparking discussions among analysts.
The Importance of 350k Addresses
Burak Kesmeci, a Cryptoquant analyst, has stated that 350k new addresses are vital for Bitcoin to maintain an upward trend.
He asserts that an increase in new Bitcoin addresses signifies a healthy market.
The 350k level is a critical point distinguishing bull and bear markets. When the number of new addresses falls below this mark, a bear season commences. Conversely, when the number remains above 350k, it indicates a strengthening bull market.
Historically, the number of Bitcoin addresses has been a significant factor in both bull and bear seasons. For instance, Bitcoin addresses have fallen below 250k three times in the past six years, each time followed by a BTC decline.
Implications for BTC
Despite not yet reaching 350k new addresses, Bitcoin is currently on a strong upward trend. The current market sentiment favors Bitcoin for further gains.
The exchange supply ratio has seen a sharp decrease over the past week, suggesting that holders are accumulating Bitcoin off exchanges with no immediate plans to sell.
Furthermore, Bitcoin’s fund flow ratio has risen over the past week, indicating increased demand and a bullish market sentiment.
At the time of writing, BTC was trading at $67714, a 5.91% increase on monthly charts. If the current market sentiment remains, Bitcoin could potentially reach the $69400 resistance level, where it has previously faced multiple rejections.
