Following the volatility of the weekend, Bitcoin holders seem to have woken up as active addresses break one million.
Number Of Active Bitcoin Addresses Reach Seven-Month High
As per the latest weekly report from Arcane Research, the crash during the weekend woke up sleeping Bitcoin investors as the number of active addresses observes a significant increase.
The “number of active addresses” is a Bitcoin indicator that measures the amount of addresses that showed some activity on the chain during a particular day.
If an addresses makes more than one move in a given day, the metric still only counts it as one active address. Because of this, the indicator may tell us an accurate picture about how many BTC holders shifted their coins that day.
When the number of active addresses rise in value, it means market activity is going up, and previously dormant addresses could be coming back up. This trend is usually seen around periods of high volatility.
On the other hand, when the indictor’s value goes down, it implies there aren’t many holders making moves. Such a trend may mean that investors are currently waiting to see the price make moves before they shift their positions. It may also simply be because of a lack of interest in the market at the time
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Now, here is a chart that shows the trend in the value of the number of active addresses over the past year:
Looks like the value of the indicator has been moving up for a while | Source: The Arcane Research Weekly Update – Week 48
As the above graph shows, the number of active Bitcoin addresses saw a sharp spike recently. The crash in the crypto’s price during the weekend was responsible for this sudden rise in the metric’s value.
Currently, the indicator’s value is above 1 million, the highest it has been in the past seven months. The last time higher values were seen was back in May, following the crash.
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As the market cooled down, there were only about 750k active addresses left by July. Since the bottom in that month, the indicator has been gradually rising in value.
It’s yet unclear if the current high values will continue to rise, or if the indicator’s value will once again drop down as the market calms down from the weekend’s volatility.
At the time of writing, Bitcoin’s price floats around $49k, down 24% in the last month. The below chart shows the trend in the price of BTC over the past five days.
BTC still in consolidation? | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, Arcane Research