- The number of mini BTC addresses has exploded over the past month.
- Reading the price chart showed that the buying pressure has weakened over time.
From bitcoin [BTC] the price regained the $20,000 mark, the number of BTC addresses that hold 0.1 BTC increased, data from Saniment revealed.
According to the on-chain data provider, since retrieving the $20,000 prize, approximately 620,000 small BTC addresses containing 0.1 BTC or less have reappeared on the network.
While the market lingered in steeply bearish conditions in 2022, these addresses saw slow growth. However, with the unexpected bull run since the start of the year, traders’ optimism has returned among this cohort of investors, Santiment noted.
🧐 There have been ~620k cubs #Bitcoins addresses that have reappeared on the network since #FOMO returned on January 13 when the price regained $20,000. These 0.1 $BTC or fewer addresses grew slowly in 2022, but 2023 shows a return of merchant optimism. https://t.co/CUAS0nV23x pic.twitter.com/wo8NBDNXs3
— Santiment (@santimentfeed) February 6, 2023
The spike in the number of BTC investors holding 0.1 BTC or less year-to-date can be attributed to fear of missing out (FOMO). Many mini BTC addresses may have come back into the market to take advantage of the recent price rally to post gains.
Will they get the desired results?
Read Bitcoins [BTC] Price Prediction 2023-24
Will you be rewarded for your FOMO?
A look at BTC funding rates revealed that it has been positive over the past month. Still positive at press time, it was pegged at 0.008.
When an asset’s funding rates are positive, it indicates that there is more demand for long positions than for short positions, and traders who hold short positions pay a fee to traders who hold long positions. .
Moreover, when the funding rate is positive, it suggests that market participants expect the price of the asset to rise.
Source: CryptoQuant
The price of BTC soared in January, and at the end of the month, there was an increase in the BTC foreign exchange reserve, indicating that many holders transferred their assets to the exchange to cash in their profits.
However, this was only temporary as the foreign exchange reserve of the king coin resumed its downward trend. According to data from CryptoQuant, the exchange reserve of BTC was 2.13 million BTC at the time of publication.
A decline in an asset’s foreign exchange reserve means that fewer coins are distributed. With a corresponding increase in the supply of coins outside of exchanges, its price may continue to rise.
Source: CryptoQuant
Further, an assessment of BTC’s Adjusted Output Spent Profit Ratio (aSOPR) revealed that at its current price, many investors have been profitably selling. At press time, the aSOPR was 1.008. A value greater than one for a coin’s aSOPR means that more investors are selling for profit.
Source: CryptoQuant
While BTC may be well positioned on-chain, an examination of its performance on the daily chart revealed that buying pressure has waned. At press time, the Chaikin Money Flow (CMF) was negative at -0.01.
Additionally, the positive directional index (yellow) of its Directional Movement Index (DMI) was positioned in a downtrend and gradually approaching the negative directional index (red). This showed that the buyers were starting to lose control of the market.
Source: BTC/USDT on TradingView
