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Pioneering on-chain market analysis. Advanced charts/data/insights for investors in Bitcoin and digital assets. https://studio.glassnode.com/
In this week's Glassnode Clips, we analyse SOPR Momentum:
- SOPR (Spent Output Profit Ratio) serves as a quick indicator, providing immediate insights into market changes by tracking profits or losses from spent coins, contrasting with slower-moving unrealized profit and loss metrics.
- SOA (Spent Output Age Bands) offers early warnings of shifts in profitability and market sentiment, relating closely to SOPR and comparing short-term to long-term averages for insight.
- Together, SOPR and SOA reveal market momentum by showing how profit-taking rates and demand balance each other, influencing trends and market stability.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=VmuvpTzcTFo&t=36s
Assessing Risk in a Bitcoin Bull
On-chain data provides both investors and analysts with a plethora of new tools to diagnose and assess the state of the chain from a multitude of viewpoints. In this article, we produce a new framework for assessing the degree of market risk across various data categories.
Executive Summary
-In this article, we introduce a new Risk Assessment framework which utilizes a suite of core on-chain instruments covering both Short-Term and Long-Term risk cycles.
- Equipped with this new framework, we aim to provide investors and analysts alike with a robust model for assessing drawdown risk from a data-driven standpoint.
- In conclusion, we compile all metrics considered into a heatmap to assess the confluence of risk across a variety of data categories.
Discover more in our latest research article.
Bitcoin Transfer Volumes remain extremely robust with around $7.7B/day in economic volume processed.
However, an elevated presence of large size entities can be observed, with the average Volume per Entity soaring to value of $25.8k/transaction.
Discover more in the latest Week On-Chain below 👇
https://glassno.de/3SjCBtJ
Are Bitcoin sellers taking profits? Are long-term holders starting to sell? We've created an interactive guide covering 3 essential on-chain metrics that will help you uncover the market sentiment.
1. SOPR: Detect market consolidation or reversal points, understanding when sellers are taking profits. Interactive view: https://glassno.de/3UqImZ3
2. MVRV: Identify market conditions as overbought or oversold, steering clear of false signals. Engage with the metric here: https://glassno.de/3HG1UBg
3. HODL Waves: Anticipate price movements by analyzing Bitcoin holding patterns for shifts in supply and investor confidence. Learn more about HODL Waves: https://glassno.de/491RmIO
Read the full guide here:https://glassno.de/3SIvSuC
For traders and investors aiming to leverage these insights, we offer API access to SOPR, MVRV, and HODL Waves metrics.
Start with our free trial to elevate your trading strategy. Explore the guide and secure your API access here: https://glassno.de/491FpCW
Exchanges remain the primary venue for trading activity, and deposit and withdrawal volumes have experienced a significant expansion, hitting $6.8B/day.
The current volume rivals peaks set during the 2021 bull market, with only 68 trading days (1.5%) recording a higher value.
Discover more in the latest Week On-Chain below 👇
glassno.de/3SjCBtJ
Assessing the severity of Bitcoin Bull Market Corrections by cycles, an increased level of resilience can noted across our current cycle.
Currently, the largest drawdown has reached a value of only -20.1%, paling in comparsion to historical precedence.
For further information on Bitcoin Price Performance, please visit our Dashboard: https://glassno.de/40Xt7GQ
In our latest Chart of the Week, we discover the significance of the Short-Term Holder Supply in Loss metric.
This cyclical indicator aids traders employing momentum strategies in the Bitcoin market. Gain insights into its role in distinguishing between market corrections and potential peaks, offering valuable information for strategic decision-making. https://www.youtube.com/watch?v=Mjcde_26JSA
The Week On-chain 04 , 2024
The approval of a suite of new Bitcoin ETFs appears to have become a classic sell-the-news event, triggering BTC prices to drop by -19%. This makes for an ideal opportunity to assess how investor profitability has changed over recent weeks.
Executive Summary
- Supply in Profit/Loss as an ideal toolkit to monitor profitability.
- Breakdowns of supply into Long and Short-Term Holder cohorts.
- Identifying divergences using simple statistical bands and levels.
Read more in The Week On-Chain newsletter and watch our latest video analysis report.
The Shrimp Cohort [<1 BTC] continues to aggressively accumulate Bitcoin
at a rate of +23.7K BTC / Month, bringing the total Shrimp supply to a value of 1.38M BTC.
For further information regarding Entity Accumulation and Distribution, visit our Dashboard: https://glassno.de/3g3mt0i
Or read our deep dive report exploring the supply distribution of Bitcoin, breaking down the supply by wallet size, and exploring how coins disperse over time: https://insights.glassnode.com/bitcoin-supply-distribution-revisited/
In our first Chart of the Week of 2024, we explore the Value Days Destroyed metric.
The introduction of spot Bitcoin ETFs, which turned out to be a "sell the news" event, prompts us to question if this marks the initial hint of a reversal in the positive trend we've witnessed over the past year. Value Days Destroyed, an indicator focused on Bitcoin's smart money, might just hold the answers. https://www.youtube.com/watch?v=n9T5zD09XTI
Attention institutional investors: On January 24th we will be hosting a live Webinar discussing the metrics that matter the most in Q1.
Join Glassnode's Lead Analyst, James Check, and David Duong, Head of Research at Coinbase Institutional, to learn:
- If digital assets correlate with traditional assets
- Where we are in the current cycle
- How adding crypto can affect portfolio performance
Seats are limited so sign up today: https://zoom.us/webinar/register/WN_32Egmw1MRzegOHK6ScgQaA#/registration
Last week, in collaboration with Coinbase Institutional, we released the Q1 2024 Guide To Crypto Markets.
Thousands of downloads & acclaim for the 44-page guide on Bitcoin, Ethereum, Stablecoins, Derivatives, and portfolio strategies.
Here’s a quick recap of what’s making waves:
- Changing Correlations in Crypto: Highlights 2023 as the year digital assets, particularly Bitcoin, showed low correlations with traditional assets, enhancing portfolio diversity.
- Portfolio Analysis (Mar 2018 - Oct 2023): Adding the Coinbase Core Index to a 60/40 portfolio notably improved both absolute and risk-adjusted returns.
Stablecoin Growth: Explores the rise of various stablecoins and their impact on Q4's circulating supply, offering insight into their increasing importance.
You can view our brand new dashboard here: https://studio.glassnode.com/dashboards/8ce2df90-f7fa-4d66-595e-4d81584825ea
Download it now: https://get.glassnode.com/q1-2024-guide-to-crypto-markets/
The SEC has greenlit 11 Spot Bitcoin ETFs, marking a significant shift for the Bitcoin market. Let's examine the on-chain impact:
- Hash Rate hit a new peak over 600 EH/s, demonstrating network strength.
- Daily on-chain transactions exceed $5.7B, with exchange flows at $4.6B.
- Futures Open Interest is at $17.6B, with crypto collateral down to 22%.
- Bitcoin's Realized Cap nears an all-time high at $438B, suggesting increased demand.
- Holder Realized Prices indicate new market entrants:
🟠 $22.4K
🔴 $37.5K
🔵 $20.9K
Despite the rising market, HODLing persists as the prevailing strategy. Yet, a rise in Short-Term Holder supply hints at emerging distribution to new investors.
For full analysis, visit: https://x.com/glassnode/status/1745458120338604490?s=20
Introducing the Q1 2024 Guide To Crypto Markets by Coinbase Institutional and Glassnode.
The 44-page Guide dives into Bitcoin, Ethereum, Stablecoins, Derivatives and portfolio allocation.
Here are some key takeaways from the report:
- Correlations have changed: Explore how cryptocurrency, particularly in 2023, returned to showing low correlations with traditional assets, reinforcing its role as a unique risk factor in diversified portfolios.
- Enhanced portfolio performance: Review data from March 2018 to October 2023 showing how adding the Coinbase Core Index to a traditional 60/40 portfolio improved both absolute and risk-adjusted returns.
- Stablecoins on the rise: Understand how various stablecoins contributed to the overall growth in circulating supply seen in Q4.
Download the guide here: https://get.glassnode.com/q1-2024-guide-to-crypto-markets/
In this week's Glassnode Clips, we focus on Short-Term Holder Profit Cycles:
- Short-Term Holder Profit Cycles Analysis highlights Bitcoin's short-term holders' influence on market dynamics, focusing on those who spend coins acquired within the last five months.
- The model tracks short-term holder coins moving from loss to profit, emphasizing periods that impact future price movements and measuring the duration of these profits.
- The analysis of consolidation periods and market inflection points shows how sustained consolidation forms a basis for price rallies, with quick changes in short-term holders' profit/loss status indicating key market shifts.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=MlUOMUEl0jo
After the challenging recovery since the FTX collapse, this indicator has advanced to 2.06, entering the High Risk 🟧 regime.
As noted, these levels are typically seen during the early stages of bull markets, as long-term investors return to a relatively meaningful level of profitability.
Read the Report here: https://glassno.de/49jl8IQ
The Week On-Chain 06, 2024
On-chain data provides analysts and investors with a remarkable degree of transparency into the performance, adoption, and investor positioning within digital assets. In this piece, we highlighted several approaches and frameworks for assessing market momentum across various data categories.
Executive Summary:
- Tools available to monitor positive and negative market momentum.
- Indicators of inflection points and shifts in direction.
- Confluence across several on-chain categories for robustness.
Read more in The Week On-Chain newsletter and watch our latest video analysis report.
In this week's Glassnode Clips, we analyse the GBTC Balance:
- GBTC's market impact is notable, with its transition from a closed-end fund to an ETF enabling share redemptions and significantly influencing Bitcoin's market dynamics, especially during the shift to a discount phase.
- The conversion of GBTC to an ETF led to significant Bitcoin outflows, including around 161,000 Bitcoin, largely due to redemptions and ETF fees.
- The ongoing market dynamics from GBTC's transition are still unfolding, with substantial outflows suggesting a shift of coins to other ETFs and a relatively modest market correction observed so far.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=KS-1FvqLH0Y&t=2s
The Bitcoin Realized Cap remains just -5.4% shy of its previous ATH of $467B, and is currently experiencing strong capital inflows.
That said, the duration for this recovery to accelerate has been markedly slower than prior cycles, arguably due to the significant supply overhang from challenging trades like the GBTC arbitrage.
🥇 2012-13 Cycle 0.22% daily
🥉 2015-16 Cycle: 0.09% daily
🥈 2019-20 Cycle: 0.17% daily
🐢 2023-24 Cycle: 0.05% daily
Discover more in the latest Week On-Chain below 👇
glassno.de/3SjCBtJ
The Week On-Chain 05, 2024
The Bitcoin market continues to show resilience, recovering from the initial sell-the-news drawdown following ETF approvals. In particular, the market is working through the significant supply overhead created by investors rebalancing capital out of the GBTC product since its conversion.
Executive Summary
- Bitcoin price performance since the 2022 lows shows striking similarity to prior cycles, albeit recovering somewhat slower, but in a more resilient manner.
- Despite a modest uptick in older coin spending following ETF approvals, the majority of long-term Bitcoin investors remain unwilling to part with their coins at current prices.
- Network activity remains low in terms of entities, but monetary volume transferred on-chain, and specifically to exchanges remains robust, and resembles prior bull market cycles.
Read more in The Week On-Chain newsletter and watch our latest video analysis report.
In this week's Glassnode Clips, we focus on Long and Short-Term Holder Supply:
- Market trends and investor behaviors are significantly impacted by changes in the balance between long-term and short-term Bitcoin holders.
- The distribution of long-term versus short-term holders serves as a market sentiment indicator, where an increase in short-term holders often aligns with market peaks, signaling new investor influx and potential volatility.
- The current market state, marked by a modest increase in short-term holder supply, suggests it isn't in a robust bull run, and a declining market could indicate insufficient demand, reflecting weaker market strength.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=8zECAQxOv1A&t=2s
Last night, David Duong, CFA, Head of Research at Coinbase Institutional, and our Lead Analyst, James Check, hosted an in-depth webinar which highlighted some key insights from our Q1 Guide to Crypto Markets.
A big thank you to the many institutional investors who attended the live webinar and asked amazing questions. If you missed it, you can access the recording here: https://get.glassnode.com/2024-crypto-guide-coinbase/
Get in touch here: https://glassnode.com/institutions
With the Bitcoin ETF becoming a classic sell-the-news event, we explore the market's risk appetite for tokens further out on the risk curve.
There are some indicators alluding to Ethereum outperformance, as well as interesting divergences in altcoin price action relative to the majors.
Discover more in the latest Week On-Chain👇
https://glassno.de/3Hszc6P
In this week's Glassnode Clips, we focus on ETFs:
- GBTC remains a key player in the ETF market, holding about 617,000 BTC. It has recently reduced its fee, shifting from a premium to a 50% discount, which impacts investor decisions.
- The ETFs saw a $7.6 billion trading volume in two days, with GBTC alone contributing $4.16 billion. Investors are weighing the trade-off between GBTC's high liquidity and its fees against other ETFs with lower fees.
- The market now features around 10 different ETF products, each with its own characteristics. This diversity presents a complex scenario for analysts and investors, requiring careful observation of the market's evolution.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=Wzwcm_mg7zU&t=1s
Whilst the fourth halving is pre-determined to occur at block-height 840,000, the exact date is unknown due to the natural variability and probabilistic nature of mining blocks.
Our best estimate given the current average block interval is that the halving is now 100-days away.
Whilst the fourth halving is pre-determined to occur at block-height 840,000, the exact date is unknown due to the natural variability and probabilistic nature of mining blocks.
Our best estimate given the current average block interval is that the halving is now 100-days away.
If you'd like to learn more about how the halving may affect the supply and demand dynamics of Bitcoin and, ultimately, its price action in the coming months, this comprehensive analysis Glassnode produced back in November is your go-to resource: https://insights.glassnode.com/the-week-onchain-week-46-2023/
The Week On-chain 03 , 2024
2024 has opened with a roller-coaster ride for Bitcoin, as ten new spot ETFs begin trading in US markets. The event was historic and chaotic, with BTC prices setting both new multi-year highs, and YTD lows. Bitcoin has welcomed traditional finance into it's world.
Executive Summary
- The successful SEC approval of ten new spot BTC ETF products set the scene for a characteristically chaotic week for Bitcoin investors.
- BTC prices set new multi-year highs, followed by YTD lows, as the market sold off -18% over the weekend. This was driven by both derivatives leverage and spot profit taking.
- Several indicators reached levels where past cycles found meaningful resistance, and was highlighted by ~75K BTC being spent by Long-Term Holders taking profits.
Read more in The Week On-Chain newsletter and watch our latest video analysis report.
In this week's Glassnode Clips, we focus on Market Year-to-Date Price Performance in 2023:
- Bitcoin experienced exceptional growth in 2023, with its market cap increasing by 170%, significantly outperforming traditional assets, and its dominance was particularly notable since October.
- Ethereum has lagged behind, evidenced by its ratio to Bitcoin reaching multi-year lows, which indicates that its growth hasn't kept pace with Bitcoin's.
- The wider altcoin sector, excluding Ethereum and stablecoins, has shown a steady performance, which parallels that of Ethereum, in stark contrast to Bitcoin's rapid growth.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=ALH1NGilj5I&t=1s
Yesterday marked the launch of the Q1 2024 Guide to Crypto Markets by Coinbase Institutional & Glassnode, and today we highlight a key piece of analysis from the report:
BTC Monthly Realized Volatility Bands
- Annual Perspective: Bollinger Bands applied over a one-year lookback period to capture a broad view of market trends.
- Volatility Insights: Pinpoints when volatility is notably high or low—identifying periods of significant price expansion/contraction or unusual calm.
These insights are crucial for investors to spot both turbulent periods and times of quiet before potential market movements.
For more insights, download our guide: https://get.glassnode.com/q1-2024-guide-to-crypto-markets/
Also, check out the accompanying dashboard for an interactive experience of the guide's insights: https://studio.glassnode.com/dashboards/8ce2df90-f7fa-4d66-595e-4d81584825ea
In this week's Glassnode Clips, we focus on Bull Market Corrections:
- The analysis uses Workbench to isolate and examine significant bull market periods, color-coding each epoch for clarity.
- It evaluates the depth of corrections within bull markets, assessing drawdowns from local highs to gauge the intensity of market dips.
- The 2023 market cycle demonstrates resilience, with relatively shallow corrections and rare drawdowns beyond 20%, indicating a strong and steady upward trend for Bitcoin.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=s3T8L6Yaeq0
In this week's Glassnode Clips, we focus on NVT Price:
- The NVT price model is used to estimate Bitcoin's fair value, highlighting its economic relevance by comparing market cap to transaction volume.
- In its analysis, the model concentrates on economically meaningful transactions, filtering out internal exchange movements and wallet transfers to enhance the accuracy of its insights.
- Recent observations from the NVT price model reveal a mismatch between Bitcoin's price rise and transaction volume, indicating rapid price increases, with a noticeable uptick in transaction activity starting from October, coinciding with an influx of new capital into the Bitcoin market.
Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=DBgdfVaM7g0