Bitcoin Approaches Key Address Threshold as Bull Market Looms
Bitcoin (BTC) has shown signs of stability in September, with a price increase of nearly 13% over the past week, according to data from CoinMarketCap. Notably, crypto analyst Burak Kesmeci has highlighted a specific factor contributing to this price surge that could potentially kickstart a bullish trend in the market.
Kesmeci recently shared insights on the correlation between the number of new Bitcoin addresses created daily and price movements. He pointed out that the recent uptick in Bitcoin prices is accompanied by a rise in new addresses, reaching 330,000 and potentially heading towards the critical threshold of 350,000.
The significance of the 350,000 mark lies in its indication of market sentiment. When the number of new Bitcoin addresses surpasses this level, it signals increasing bullish influence and an upward price trajectory. Conversely, a drop below this threshold could signify a market correction or the start of a bearish phase.
Kesmeci elaborated that a sustained decline in new BTC addresses below 250,000 historically led to bearish market conditions, as observed during significant price drops in previous years, such as from $19,000 to $6,000 in 2018 and from $64,000 to $30,000 in 2021.
The recent resurgence in new Bitcoin addresses, rebounding from below 200,000 to over 300,000, has been particularly noteworthy. Kesmeci suggested that if this metric climbs above 350,000, especially post the upcoming US Federal Reserve meeting, investors in BTC could be in for a promising period ahead.
On the other hand, concerns have been raised regarding the potential impact of Bitcoin spot ETFs on network growth. While these exchange-traded products are anticipated to drive institutional demand for Bitcoin, Kesmeci cautioned that ETFs consolidating BTC holdings for multiple investors could hinder the organic growth of the network. This underscores the ongoing necessity for a continuous influx of retail investors, even amidst ETF-driven price surges.
As of the latest data, BTC is trading at $60,395, reflecting a 4.31% increase in the past day. However, the daily trading volume has decreased by 9.35% to $30.5 billion.
In conclusion, the evolving dynamics of new Bitcoin addresses and the potential implications of spot ETFs on network growth are key factors influencing the current state and future outlook of the cryptocurrency market. Investors are closely monitoring these developments for insights into potential market trends and price movements.
