Bitcoin active addresses 'concern' analyst despite 50% BTC price gains

cointelegraph.com:

Bitcoin (BTC) still lacks the on-chain volume and active address increases which characterize bull markets, research warns.

In a frank appraisal of the 2023 BTC price rebound, on-chain analytics platform CryptoQuant warned that Bitcoin may be weaker than it seems.

As on-chain metrics flip green and some even flash bull signals not seen in years, a healthy dose of suspicion remains among many analysts.

CryptoQuant contributor Yonsei_dent is among them, writing in one of the platform’s Quicktake blog posts this week that 2023 does not chime with previous bull markets.

The problem, he explains, lies in active addresses, which are not increasing in number despite BTC/USD gaining almost 50% year-to-date.

“Active Addresses is a metric that includes all addresses sending and receiving BTC, providing a look at how active market demand is,” the blog post reads.

An accompanying chart shows the 30-day moving average (MA) of active addresses increasing following the end of the 2018 bear market and the March 2020 COVID-19 cross-market crash. 2023, by contrast, has yet to produce the same trend.

“You can see that Active Addresses (30DMA) increased both during the 2019 bull market turnaround and when coming out of the 2020 COVID-19 shock,” Yonsei_dent added.

Other research this week produces similar conclusions about the Bitcoin investor habits, which have accompanied the return to $25,000.

Related: A ‘snap back’ to $20K? 5 things to know in Bitcoin this week

On-chain volume, analytics firm Glassnode notes, remains low, and both long-term holders (LTHs) and short-term holders (STHs) are reluctant to spend.

“Despite net growth in on-chain activity, and an ATH in total UTXOs, transfer volumes are remarkably subdued, both for Long and