Although the price of Bitcoin has soared to levels not seen in three years, many other factors indicate that the current gains are similar to the 2017 bull market. Active Bitcoin addresses are close to the highest record in history, while the hashrate of the network is still very high, sliding at 130 exahash. In addition, the bitcoin derivatives market has surpassed the highest level in history and is open to options, and futures have never been so high.
After 1,079 days of waiting, on November 30, 2020, BTC broke its record high set in mid-December 2017. Since then, BTC has been about $1,000 lower than ATH because traders and analysts are not sure what will happen. Happened next. Despite the slight decline, there are still some indicators that indicate that the current market is very similar to the bull market three years ago.
For example, an on-chain analytics researcher from Glassnode Tweet Regarding how active BTC addresses reached close to the third highest value of 19.6 million in November. As early as December 2017, the number of active addresses reached 21.64 million, and in January 2018 it reached 19.67 million.
Block’s research director Larry Cermak told his Twitter followers on December 2 that many indicators have reached record highs. “The total on-chain transaction volume, which represents economic throughput, grew strongly by 51.5% and hit an annual high of US$204 billion in November. Bitcoin’s on-chain transaction volume was twice that of Ethereum in November.” Said.
The researcher also emphasized that BTC miners generated $520 million in revenue last November. “Compared to the previous month, a significant increase of 48%,” Cermak write. “This is the highest income since February 2020, and it is higher than the income before the halving.”
Bitcoin’s hash rate has also been high because many people believe that hash power follows price. Currently, on December 2, the entire BTC hash rate is approximately 129 exahash per second (EH/s). In 17 mining operations on Wednesday, the SHA256 hash points to the BTC chain, and the network difficulty is very high. Currently, the difficulty is US$19.16 trillion, and in about 11 days, it may exceed US$20 trillion at the current rate.
Glassnode statistics It shows that the “number of active entities (7d moving average)” has increased a lot in 2020, “now close to 400,000 active entities per day.” The researchers pointed out that in terms of active entities, this is less than 4% of the previous ATH .
“This increased on-chain activity indicates an increase in network adoption and usage. However, unlike the recent bull market, [Number of New Entities] It’s still relatively low,” Glassnode wrote in its “Weekly Online” report released on November 30.
In addition to the recent milestones in the BTC spot market and the achievements on the chain, other investment tools that utilize encrypted assets have also seen huge demand. As far as the Bitcoin derivatives market is concerned, the open interest in the options and futures markets both hit record highs. The crypto trading platform Deribit took away the majority of bitcoin options and explained in a recent newsletter that it “has achieved many new records.”
Deribit pointed out: “Intensified turbulence has also increased the demand for options.” “In November, a number of new records were achieved. The new monthly notional turnover reached 14.3 billion US dollars, and the average daily new record of BTC options reached 25,000. For BTC contracts, the largest option OI reached US$4.8 billion, an increase of 100% compared to October.”
The trading platform pointed out that last month, “volatility almost doubled, BTC reached 84% compared to 49%”. However, in general, the volatility of the Bitcoin derivatives market has been changing, and Deribit emphasized: “The volatility term structure changed from an upward sloping to a downward sloping in just a few days.”
Despite some retracements, once BTC breaks through the $20,000 price zone, analysts will emphasize that the historical resistance above the psychological zone is zero. Bitfinex’s CTO Paolo Ardoino explained that since the last bull market in 2017, the cryptocurrency field has matured a lot.
“The cryptocurrency market is retracing some recent gains today,” Ardoino said. “As some of the euphoria in the crypto space subsides, participants can reflect on the degree of development of the space since the last historical high of $20,000 in Bitcoin. Cynical, skeptical, and even fanciful ideas cannot hide Bitcoin’s convincing reasons “Global asset managers will continue to re-adjust their investment portfolios accordingly.”
What do you think of all the milestones achieved by Bitcoin in 2020? Let us know your thoughts on this topic in the comments section below.
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