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Pioneering on-chain market analysis. Advanced charts/data/insights for investors in Bitcoin and digital assets. https://studio.glassnode.com/
The Week On-Chain 35, 2024
Market speculation remains relatively subdued for Bitcoin, with investors locking in only marginal profit and losses, and a reset across perpetual swap markets. Historically, periods of quiet and calm market structure are short-lived, and often precede an expectation for heightened volatility.
Executive Summary
- Net capital flows into the Bitcoin assets have markedly cooled, with only marginal profit and loss-taking events by investors.
- Loss-taking events are almost exclusively associated with the Short-Term Holder cohort.
- However, a significant proportion of supply held by this cohort is transitioning into Long-Term Holder status, having been held for at least 155 days.
- Speculation in the perpetual swap market has experienced a full reset, suggesting a cooling off of speculative interest and long-biased leverage.
Read more in The Week On-Chain newsletter.
Bitcoin Dominance has surged from 38% in Nov 2022 to a notable 56% today. Meanwhile, Ethereum, the second-largest asset, saw its dominance decline by 1.5%, remaining relatively stable over the past two years.
In contrast, Stablecoins and the broader Altcoin sector experienced more significant declines of 9.9% and 5.9%, respectively.
🟠Bitcoin Dominance: 38.7% (Nov 2022) —> 56.2% (Current)
🔵Ethereum Dominance 16.8% —> 15.2%
🟢Stablecoin Dominance 17.3% —> 7.4%
🟣Altcoin Dominance 27.2% —> 21.3%
Discover more in the latest Week On-Chain below👇
https://glassno.de/4dPrVvN
The LTH Sell-Side Risk ratio remains lower than during previous ATH breaks, indicating that the LTH cohort is taking smaller profits compared to past cycles. This suggests they may be waiting for higher prices before increasing their selling pressure.
Discover more in the latest Week On-Chain below👇
https://glassno.de/4fGn2Hk
Last night, David Duong, Head of Research at Coinbase Institutional, and our Lead Analyst, James Check, hosted an insightful webinar, highlighting key takeaways from our Q3 Guide to Crypto Markets.
A big thank you to all the institutional investors who joined us and engaged with thoughtful questions.
If you missed it, you can access the recording here: https://glassno.de/3SRG6sb
The Week On-Chain 33, 2024
With the market currently digesting the largest downtrend of the cycle, indecision amongst digital asset investors remains apparent. However, below the surface, a distinct return to HODLing and accumulation appears to be underway.
Executive Summary
- After several months of relatively heavy distribution pressures, the behavior of Bitcoin holders appears to be rotating back towards HODLing and accumulation.
- Activity in spot markets shows that there has been a net bias towards sell-side pressure of late, and this has not yet completely subsided.
- Compared to ATH breaks in past cycles, there is currently a relatively large percentage of network wealth held by the Long-Term Holder cohort.
- Overall, on-chain conditions speak to an undertone of high conviction amongst the Bitcoin holder-base.
Read more in The Week On-Chain newsletter.
In derivatives markets, a large volume of long positions were forced closed, with a total volume of $275m worth of long contracts liquidated. Additionally, an extra $90m was liquidated from the short-side, for combined total liquidation volume of $365m.
Discover more in the latest Week On-Chain below👇
https://glassno.de/3WTkT3t
The Week On-Chain 32, 2024
August has already been a exceptionally eventful month across both equity and digital asset markets, after a “correlation-1” event sparked a major market sell-off. Bitcoin has been no exception, recording its largest drawdown of the cycle, causing capitulation amongst Short-Term Holders.
Executive Summary
- A “correlation 1” event has seen major assets and equities decline markedly, with Bitcoin being no exception, recording its largest drawdown of the cycle.
- The price contraction has resulted in the BTC spot price reaching the Active Investor Price, located at $51.4k, which is a crucial level for investor psychology.
- A dramatic flush out of leverage has also occurred, with futures open interest declining by 11% in one day. This likely increases the importance on on-chain data moving forwards.
Read more in The Week On-Chain newsletter.
Amid global market uncertainty, our on-chain checklist helps traders optimize their exit strategies using Glassnode's on-chain metrics like MVRV Ratio, Long-Term Holder Spending, and HODL Waves.
Learn to identify key levels and navigate market downturns effectively. Download the checklist here: glassno.de/3VAjUVr
Daily active addresses on Ethereum and leading L2s have increased by 127% this year. This metric measures the number of distinct addresses interacting with the chain, indicating user base growth.
More insights from our report with Coinbase Institutional → https://glassno.de/4ddXPSn
The Week On-Chain 31, 2024
After more than a decade of legal process, the long awaited creditor distribution of the Bitcoin recovered from the Mt.Gox exchange collapse is underway. From a psychological perspective, this represents the final chapter in what has been a major market overhang over the industry since 2013.
Executive Summary
- After a prolonged legal process, Mt.Gox creditors are finally receiving Bitcoin recovered from the exchange hack. Currently, 59k of the 142k BTC has been distributed via Kraken and Bitstamp.
- Wealth held by new investors is declining, well below levels seen at macro market tops, indicating a shift back towards HODLing.
- The distribution pressure by the LTH cohort remains relatively light, and is in decline. Alongside this, Long-term investors currently hold 45% of the network wealth, which is relatively elevated compared to levels seen near macro cycle topping events.
Read more in The Week On-Chain newsletter.
Bitcoin has historically exhibited exponential gains during bull cycles, but each cycle has also seen numerous large drawdowns. The current cycle has seen:
- Eight drawdowns between 5%-20%
- Two drawdowns between 20%-30%
- No drawdowns greater than 30%
Discover more insights from our recent Q3 report with Coinbase Institutional → https://glassno.de/4ddXPSn
The Week On-Chain 30, 2024
Bitcoin prices have rebounded strongly, rallying over $68k and catalyzing an uptick in perpetual futures activity. The appreciation in price has also provided much-needed relief for the Short-Term Holder cohort, with 75% of their coins now held in profit.
Executive Summary
- Binance, Bybit and OKX remain the industry leaders for perpetual swap markets, accounting for around 84% of the total open interest.
- We introduce a novel model to track the sensitivity of leverage and Open Interest in Futures markets relative to changes in the spot Bitcoin price.
- Price has climbed back above the Short-Term Holder cost basis, which has provided much-needed relief for new investors, with over 75% of their supply moving back into profit.
Read more in The Week On-Chain newsletter.
CME Group futures now represent over 83% of the calendar futures market for Bitcoin and 65% for Ethereum, highlighting CME's growing influence in institutional trading.
Discover more insights from our report with CME Group → https://glassno.de/3XPCQkx
The Week On-Chain 29, 2024
The Bitcoin market recently absorbed over 48k BTC in sell-side sourced from the German Government. With Mt Gox distributions also on the horizon, we examine these major sell-side forces, as well as the role ETFs have on price action.
Executive Summary
- Large labelled entities currently hold approximately 4.9M BTC, which is equivalent to 25% of the circulating supply. Amongst these entities, centralized exchanges and ETF custodians account for the largest portion.
- Following the complete exhaustion of BTC sell-side by the German Government, there appears to be near-term sell-side relief, as well as renewed inflows of demand to support the market.
- Market profitability remains remarkably robust, with the majority of the coin supply still held at a favourable cost basis, and below the current spot price.
Read more in The Week On-Chain newsletter.
Since the launch of the Runes protocol on April 20, 2024, we've observed a significant surge in transactions, largely displacing BRC-20 tokens, Ordinals, and Inscriptions. As of current, Runes-related TXs account for an impressive 66% of total daily TXs.
Explore our latest Runes metrics to gain deeper insights into this trend 👇
https://glassno.de/3xTL6oY
Amidst tumultuous market conditions as of late, Long-Term Holders have been locking in a reasonably consistent $138M in profit per day. With each transaction, a buyer and a seller are matched, with supply and demand imbalances resolved via price changes.
Therefore, we can infer that this ~$138M/day in LTH sell-side pressure is a read for the daily capital inflows required to absorb supply and keep prices steady. While market conditions have been choppy, prices are generally flat over the last few months, suggesting a form of equilibrium is being reached.
Discover more in the latest Week On-Chain below👇
https://glassno.de/4dPrVvN
The Week On-Chain 34, 2024
Bitcoin, as the leading digital asset, continues to see its dominance expand, now commanding a staggering 56% of the total market capitalization. Supporting this, Bitcoin Long-Term Holders remain steadfast in their conviction, with significant accumulation pressure below the surface.
Executive Summary
- Since the cycle low established in Nov 2022, Bitcoin Dominance has continued to climb, now commanding 56% of the total crypto market capitalization.
- Despite tumultuous and choppy price action, the conviction of Long-Term Holders remains steadfast and unfazed, with a clear preference to accumulate and HODL coins.
- Short-Term Holders have carried the brunt of the losses during the recent downturn, however, the degree of locked in losses suggests a possible overreaction towards the event.
Read more in The Week On-Chain newsletter.
The Accumulation Trend Score (ATS) indicates a market shift back to accumulation, with the ATS reaching its maximum value of 1.0, signaling significant accumulation over the past month.
Discover more in the latest Week On-Chain below 👇
https://glassno.de/4fGn2Hk
Since Bitcoin's ATH in March, the market has seen widespread supply distribution across all wallet sizes. Recently, this trend shows signs of reversing, especially among the largest wallets, often linked to ETFs, which are now returning to accumulation.
Discover more in the latest Week On-Chain below👇
https://glassno.de/4fGn2Hk
Amid the recent surge in global volatility, understanding the broader forces at play in crypto markets is more important than ever. Join us on August 15th, at 6 PM EST for an exclusive webinar, featuring Glassnode Analyst, James Check, and David Duong, Head of Institutional Research at Coinbase Institutional.
In this session, James and David will analyze the Q3 Guide to Crypto Markets, offering insights to help you navigate current market turbulence. Key topics include:
- The rapid rise in on-chain activity and what it signals for the future of market adoption.
- The transformative impact of ETFs on market liquidity and investor engagement.
- A deep dive into the current market cycle, comparing it to previous cycles to forecast future trends.
- The significance of MVRV Momentum as a key indicator of market resilience and investor sentiment.
Don’t miss this opportunity to gain a holistic view of the digital asset landscape. Seats are limited—secure your spot today: https://glassno.de/3M095X9
On Monday 5-Aug, equities and digital assets sold off sharply, as the unwinding of the yen-carry trade deleveraged markets, and US treasuries rallied on fears of a recession.
Bitcoin recorded a drawdown of -32% from the ATH, the most severe of the current cycle.
Discover more in the latest Week On-Chain below 👇
https://glassno.de/3WTkT3t
Given the sudden market reaction and declines in markets globally, understanding seller exhaustion among short-term holders has become increasingly important. Our analysis of the Short-Term Holder Seller Exhaustion Model provides insights using metrics like STH MVRV, STH SOPR, and STH Realized Loss to navigate through volatile times.
Learn more about this model and its applications here: glassno.de/3WWWzOV
Kraken and Bitstamp have been selected as designated exchanges responsible for redistributing creditor funds. Kraken has now received 49k BTC, and Bitstamp has received the first tranche of 10k BTC.
Discover more in the latest Week On-Chain below 👇
https://glassno.de/4ckrt7X
Bitcoin Daily Active Entities, measured as clusters of addresses controlled by the same entity, fell 16% in Q2 2024. This metric helps gauge user adoption and network activity.
More insights from our report with Coinbase Institutional → https://glassno.de/4ddXPSn
Bitcoin Spot ETF Balances now exceed $50B in AUM since their January 2024 launch, marking the most successful ETF debut in history. This chart shows the daily balances of the top US-traded Bitcoin ETFs.
More insights from our report with Coinbase Institutional → https://glassno.de/4ddXPSn
Introducing the Q3 Guide to Crypto Markets by Coinbase Institutional and Glassnode.
This third installment highlights the ongoing bull market, ETF impact, and surge in on-chain activity.
Key points from the 65-page guide:
- Bull Market Dynamics: Since November 2022, Bitcoin prices have quadrupled. This cycle had drawdowns of 5%-30%, with none exceeding 30%, a rarity in past cycles.
- ETF Influence: Spot Bitcoin ETFs, launched in January 2024, amassed $50B in AUM within six months, boosting crypto interest and trading volumes. ETF inflows have outpaced new Bitcoin issuance, indicating strong demand.
- On-chain Growth: On-chain activity is up, with daily active addresses on Ethereum and Layer 2 solutions increasing by 127% in 2024. Despite a 58% drop in user fees post-Ethereum's Dencun upgrade in March 2024, transactions rose by 59%, showing real utility.
Download the guide here: https://glassno.de/4ddXPSn
We have now made the Spot Bitcoin ETF metrics accessible to all our users. View the latest ETF balances and flows from VanEck, BlackRock, Fidelity, and others in near real-time.
For more information, go to Glassnode Studio: https://glassno.de/3y3ER1Y
Bitcoin currently sees around $46.4 billion in on-chain volume daily, comparable to traditional payment processors like Visa and Mastercard. Filtered economical transfer volumes are closer to $6.5 billion per day.
Discover more insights from our report with CME Group → https://glassno.de/3XPCQkx
The Bitcoin market experienced around 18 months of steady price appreciation after the collapse of FTX, followed by three months of range-bound price action after the $73k ETF high.
Between May and July, the market experienced its deepest cycle correction, recording a drawdown exceeding -26% from the ATH.
Discover more in the latest Week On-Chain below👇 https://glassno.de/3zBT1b6
Bitcoin's market cap increased by $1.13 trillion (+370%) since November 2022, and Ethereum's valuation rose by $354 billion (+267%) over the same period.
Discover more insights from our report with CME Group → https://glassno.de/3XPCQkx