There is a continuous decline in the supply of BTC and the growth of users of the Bitcoin network. A financial calculation explains the reasons for the increase in the price of the leading cryptocurrency.
Bitcoin (BTC) completed its second major correction in this bull market last week. The price received a supportive wave and reached a $ 43,000 radius and increased by 44% over the next 13 days. BTC peaked at the new ATH (all-time high)at $ 61,844.
Without seizure, a new all-time major set an establishment over the weekend, with a worrying decreasing size. The week’s compromise brought a fall of 13% and the push of support in the radius of 53,300 dollars.
The daily obstruction was not below the relevant support radius at $ 55,000, the 0.382 Fibonacci retracements of the initial steep move. This situation shows that the uptrend faced an opportunity to keep going its way to a new ATH.
Users can have a vision that something is going to happen in March and early April. The expected increase in size does not indicate the direction of the following price battle.
Fixed Bitcoin Supply Keeps Descending
Research in captivity shows that the supply of fixed Bitcoin continues to decline. This research reflects in the “Liquid Supply Change” indicator, which in recent days generated the second most egregious daily display of BTC’s solvency reduction in more than three years.
These days had brought tremendous changes in universal wealth in the wake of the COVID-19 crisis that began in March 2020. It is evident that more and more retail and institutional investors seek a proper outlet to cash and are giving Bitcoin the hedge’s role.
It seems that such a process is only skyrocketing as more and more long-term hodlers lack profit. This situation appears after the long-term investor’s net position change indicator.
Network Users Are Climbing High Massively
The high number of Bitcoin users is Interesting due to the recent rise in new financial entities, which is almost at the same level as at the peak of the 2017 cycle when Bitcoin reached $ 20,000.
The daily increases in users slightly exceeded the 5,000 level at that time. Then four years later, it already reached a figure of nearly 35,000. This situation shows that the number of new users might surpass 100,000 or even catch a far higher number at the current cycle height.
Willy Woo made a post on Twitter about the increase in users. It states that if the captive data shows 35,000 new participants, users’ daily admission to exchanges, whose activity does not directly affect the blockchain, could already reach around 100,000 daily.
By: Jenson Nuñez
