The number of bitcoin wallet addresses with non-zero balances of the world’s first, most popular and largest cryptocurrency by market capitalization hit a new record high this week, suggesting a challenging bear market ahead of 2022 and the bitcoin network’s global future. Adoption continues to grow despite adoption. Tough global economic outlook for 2023.
According to data presented by crypto analytics firm Glassnode, the number of Bitcoin Addresses with non-zero balances exceeded 43.8 million on Wednesday 8th January for the first time. The number of printed addresses exceeded the previous record high of 43.76 million in mid-November 2022.
Back in November, the collapse of what was previously one of the world’s largest cryptocurrency exchanges, FTX, resulted in customers losing access to billions of funds, prompting a shift towards crypto self-custody. investors rushed to pick it up Bitcoin off exchange, triggering an increase in the address count at that time.
However, as a capitulation of bitcoin As the price plummeted to new 2022 lows in the wake of panic about transitioning from FTX’s bankruptcy, many wallets got rid of all their bitcoin, triggering an equally rapid pullback in non-zero address numbers.
The bitcoin price has gained nearly 40% since the start of the year on 1) optimism for an improved macro backdrop in 2023 and 2) increased on-chain and technical signs that the bitcoin bear market is strong enough to entice new investors. It’s over for the bitcoin market to get back to record highs to get a non-zero wallet address.
Non-Zero Address Growth Driven By Arrival Of Small Investors
According to Glassnode data on bitcoin wallet address cohorts, the most recent surge in non-zero address numbers has been caused by a surge in wallets holding small amounts of BTC. The number of so-called shrimp wallets holding less than 1 BTC set a new record of over 42.827 million.
Meanwhile, the number of crab, fish, shark and whale addresses holding more than 1-10, 10-1K and 1K BTC, respectively, has stabilized. Crab, Fish and Shark wallet numbers initially spiked in the wake of the drop in bitcoin price following the collapse of FTX, with large investors using the opportunity to buy the dip.
Thus it can be concluded that the recent increase in the number of non-null wallet addresses is occurring with a rotation from large investors to smaller new investors in bitcoin ownership. Large investors are much more likely to fall into the HODLer camp – those who buy and sit on their BTC for the long term given their strong belief in the cryptocurrency’s outlook.
Further evidence is gathering that the bitcoin market may be in the early stages of a rotation from HODLers to new investors – a trend that often coincides with the birth of new bitcoin bull markets.
Rotation From HODLers To New Investors Begins – What This Means For BTC
Glassnode’s real HODL ratio (RHODL), the ratio of the two bitcoin age bands, appears in the process below. RHODL is a measure of the spread of bitcoin wealth distribution among experienced and new investors, calculated by comparing the number of coins that have not moved for 1-2 years with the number of coins that have been bought within the past week.
In late December, RHODL fell to its lowest level since the 2019 bear market, but has since seen a decent rally. As can be seen in the chart above, RHODL rebounds typically go hand-in-hand with rising bitcoin prices – RHODL captures increased demand for BTC from new investors, historically long-term price appreciation in the bitcoin market. There has been an increase in participation with ,
So does the increase in non-null wallet addresses mean that the price of bitcoin is going higher from here? Well, not necessarily. The number of non-zero addresses grew (slowly) for most of 2022, and this was not enough to stop the bears. An increase in the dominance of older coins in the RHODL ratio resulted in surrenders from short-term investors with weak hands and demand from new dip-buying investors was not enough to stop the decline in prices.
For the growing number of non-zero addresses to be a bullish sign, it must also be accompanied by evidence that BTC wealth is also moving towards new investors, which is certainly the case right now.
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