As on-chain activities fall asleep, the number of “young” coins in both Bitcoin and Ethereum is declining. The market update.
After an unsuccessful start to the week, the crypto market is turning back into positive territory. However, the Bitcoin course cannot benefit from this at the moment. The largest cryptocurrency slipped by a bearable 0.2 percent in the 24-hour comparison and is thus listed at 47,755 US dollars at the time of going to press. On a weekly basis, the BTC rate loses 3.3 percentage points.
The Altcoins can sometimes post strong price laundering. While Cardano (ADA), Binance Coin (BNB) and Dogecoin (DOGE) are taking moderate price discounts of up to two percent, Ethereum (ETH) is up 5.5 percent on a daily basis. XRP is slowly moving forward with a plus of 0.5 percent. The two outliers are Solana (SOL) with a price increase of 20 percent and Polkadot (DOT) with an increase of 10 percent.
On-chain activities in snooze mode
Although Bitcoin and Ethereum have seen significant price increases in recent weeks, on-chain activities are still in sleep mode. According to Glassnode’s latest Week-On-Chain report, trading activity in both Bitcoin and Ethereum is well below the recent record highs. The number of active units, i.e. those that either receive or issue transactions, is currently 275,000 daily in the BTC network. That is 35 percent less than in January.
With Ethereum, too, the number of active addresses has fallen by 33 percent compared to the high in May. It is currently around 450,000 a day.
The picture is similar when it comes to the number of transactions. Currently, the number has fallen to an average of 200,000 transactions per day, which corresponds to a decrease of 37.5 percent compared to the record high.
Hodl trend in Bitcoin and Ethereum
Although on-chain activities are declining, only limited conclusions can be drawn about a rather bullish or bearish market sentiment. As Glassnode adds, much of the trading activity is shifting to over-the-counter direct trading. In addition, there are derivative financial instruments and the use of second-layer solutions such as the Lightning Network, which are not processed on-chain.
The distribution and accumulation of BTC stocks at the respective price levels is therefore more meaningful for overarching market trends. This shows that the number of “young” coins, i.e. those that have been moved in the past three months, is declining and only account for 15 percent of the total amount in circulation. According to Glassnode, these coins are typically particularly susceptible to sales. Conversely, the decline in the “Hodl waves” shows an accumulation trend among investors.
Ethereum also shows a downward trend in young coins, which are “heading for a long-term low of 12.5 percent of the circulating supply”. A good sign because “older coins are statistically less likely to be issued and their increasing proportions indicate an increasingly illiquid supply”.