After the bearish signals, the on-chain metrics for bitcoin have reversed. The number of wallets that are not zero and those holding at least one BTC have reached new highs.
This is just a few days after large entities such as whales made significant transfers of their BTC holdings amid the ongoing conflict between Russia and Ukraine.
Bitcoin Address in a Tear
Non-zero addresses, as the name implies, are wallets that contain even a small amount of bitcoin. Glassnode, an analytics resource, revealed that these entities have been increasing in recent months and reached a new record after surpassing 40 million.
The graph below shows that such addresses, which usually reflect retail investors’ behavior and spiked during the last bull cycle, plummeted shortly thereafter – just as BTC began its retracement.
They grew in the following year, before stabilizing at 35 million for a time. Glassnode stated that they were now 40,276,163 by early February 28.
Non-Zero Bitcoin Addresses. Source: Glassnode
It’s not just non-zero addresses who have seen an increase in recent months. Analytics company said that wholecoiners, which are entities with at least one bitcoin, have recovered from the recent decline and reached a 10-month peak. There are now over 800,000.
Bitcoin 1+ addresses. Source: Glassnode
What is the Calm after a Storm?
After weeks of increasing tension, Russia launched a “special military operations” against Ukraine last week. Naturally, Europe’s first conflict in more than 70 years caused financial markets turmoil. Bitcoin lost approximately $5,000 in a matter of hours while bearish signals kept coming.
Many BTC investors were forced to sell their holdings due to uncertainty. Similar situations are not uncommon for retail investors, but this time whales transferred large amounts of cryptocurrency, according to Santiment data.
As BTC fell below $35,000., the firm saw transactions in bitcoin worth more than $100,000 and $1,000,000 respectively. Santiment also stated that bitcoin’s token circulation reached a 9-month high after BTC dropped below $35,000.
This BTC movement was reminiscent of the March 2020 events, when the COVID-19 pandemic was officially declared. The landscape seemed to have settled down in the days following the war. BTC also quickly recovered most of the USD value lost.
The #Bitcoin token circulation reached a 9-month peak, which shows how polarized traders are with the #war. This was similar to #BlackThursday in Mar 2020, when #crypto traders were selling at the bottom of #COVID. https://t.co/1XM82Asf4x pic.twitter.com/Z7gHJ7MY7F
— Santiment (@santimentfeed), February 26, 2022
Marla Brooks – Financial Analysis
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