Hash Rate massively increases! Could this be another opportunity after the liquidation?
Rainbow Bitcoin Weekly 22.01.17
After the daily K-line of Bitcoin fluctuates downward in the past two weeks, Bitcoin has come to a market dominated by shocks, and after waiting for the adjustment, the daily K-line level will choose a new direction. From the perspective of the 4-hour level, the support and resistance have not changed much. The high point of the rebound begins to move down. This is an unfavorable pattern for the bulls and tends to weaken. An hour-level confrontation between bulls and bears, the bears are slightly stronger than the bulls, and the strategy is mainly high-altitude. From another perspective, the bitcoin held by mainstream exchanges has decreased significantly compared with the previous two weeks, and the selling pressure has been relatively reduced. Although the data on the chain is still very sluggish, there is a breakthrough in the Bitcoin hash rate, suggesting that it is difficult for the market to enter a completely bear state. The Spring Festival is approaching, and the market is often not too investor-friendly when the Chinese New Year is approaching. It is recommended to operate cautiously, hold the chips in your hand and wait for certain opportunities. The above content is for reference only and does not constitute investment advice.
What’s happening last week:
l Walmart has filed 7 patent applications related to the Metaverse, NFTs and encryption.
l The 24-hour trading volume of ADA once surpassed Ethereum and ranked second.
l The USDT market share fell to 53.52%, continuing to hit a new low.
l Elon Musk tweets about the Metaverse and NFTs and it hint at market chaos.
l The British Museum has now accepted Ethereum to purchase NFT versions of its exhibits.
l Ministry of Public Security in China: cracked 259 cases related to virtual currency money laundering and seized virtual currency worth more than 11 billion yuan.
l Meta will invest $10 billion in Metaverse in 2022.
l Some products on Tesla’s official website began to support Dogecoin as a payment method.
The recap of the additional data analysis for this week is down below.
Number of on-chain Bitcoin Transactions
For the recent 3 weeks, the number of on-chain Bitcoin transactions does not fluctuate significantly. The highest value within this period stays near 280 thousand. Last week the highest has reached 277 thousand and the lowest has reached 218 thousand. The overall trend is switching from fluctuating upwards to partially fluctuating downwards. The number of transactions has been slowly increasing since February 2018.
The number of on-chain Bitcoin transactions symbolizes the core value of Bitcoin and is also an important supporting factor of Bitcoin market price. Currently, the Number of On-chain Bitcoin transactions is showing a rapid growth in the short term.
Hash rate of Bitcoin
The hash rate of Bitcoin has shown a large increase last week. From the relatively stable 178 Ehash/s in the previous week, it jumped directly to the highest point of this week at 207.2 Ehash/s. It became the highest in history.
The value of the Bitcoin hash rate among the whole network has been doubled since the low point in June this year. Hash rate is considered as the basis of Bitcoin since it directly affects the market price of Bitcoin. It is fair to say that the hash rate is the core stone of Bitcoin’s long-term value.
Bitcoin Supply on Exchange Wallet
The bitcoin supply on mainstream exchanges has significantly decreased compared to the week before. In the last 7 days, most mainstream exchanges have decreased the reserve of bitcoin by 26,550 which results in a total of 1,286,775 Bitcoins. The selling pressure has fallen. The total supply stays at the level of 6.1%.
The supply of Bitcoin among exchange wallets is a vital index to monitor Bitcoin’s market price trajectory. The net inflow foreshadows the large pressure of selling off their Bitcoin while the net outflow indicates that the investors are more likely to hold their Bitcoin.
The open interest in the grayscale trust
The grayscale trust has underweighted 249 Bitcoins last week which is underweighted 990 Bitcoins in the last 30 days. What is worth mentioning is that the underweighting has become stronger since Jan 15th.
The Grayscale BTC trust has remained outflowing since March 3rd. On Jan 7th, the Grayscale BTC trust open interest is 644,300 and the GBTC premium index is -23.16%.
USDT Premium Rate
The USDT premium is fluctuating back to a normal level of 1.00029849. It is a significant increase compared to the week before. However, it still has much to catch up compared to a month before.
The USDT premium index is the ratio of USDT/USD and it reflects the volume of fund which enters the market.
Fear & Greed Index
The fear & greed index has decreased again after slightly calling back at the week before. Right now it is at the level of extreme panic. Last week’s average maintains at the level of 22. It is recommended to add positions rationally but please manage the investments carefully and stay focused on risk control.
Fear & Greed Index, also known as VIX (Volatility Index). It is originally a stock market index containing many factors such as market volatility, market trading volume, social media heat, and Google buzzwords analysis. The threshold of this index is 0 to 100. The lower index indicates the investors are more likely to sell while the higher index indicates the investors are more likely to hold. Fear & Greed index can be used to predict the potential risk for helping to make investment decisions. An extremely low fear & greed index could bring potential opportunities for buying while an extremely high fear & greed index could bring massive change to the market.
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Disclaimer:
This article is NOT in any form an investment recommendation, please research carefully before you make any investment decisions. The price of bitcoin is $41,700 while this article is being written.
2022.1.17