Since Bitcoin (BTC) is trading above the psychological price of $20,000, Glassnode has released his weekly on-chain report titled “Hammering Out The Bottom,” exploring the stakes and risks that may lie ahead on the road ahead.
The market statistics provider stated:
“Bitcoin bounced back above the $20,000 level this week, hitting a low of $19,215 and trading as high as $20,961. After consolidating in an increasingly tight range since early September, this is the first relief rally in many months.”
Bitcoin is up 6.6% over the past seven days, hitting $20,626 in intraday trading, according to CoinMarketCap.
Since the realized price is the average acquisition price for the coin, Bitcoin is currently nearing the bottom of the realized price set at $21,111. A break above it would mean remarkable power.
The redistribution of wealth continues
During the bottoming phase, declining investor profitability usually triggers a redistribution of wealth in coins as weaker hands capitulate to serious financial pain.
Using the UTXO Realized Price Distribution (URPD) indicator, Glassnode noted that more consolidation and duration may still be needed in the current bear market as coins changing hands are lower than the bottom discovery phase of 2018-2019 where 22.7% was redistributed overall offer. .
The market intelligence provider pointed out:
“Performing the same analysis in 2022, we can see that approximately 14.0% of supply has been reallocated as the July price has fallen below the realized price, with a total of 20.1% of supply now taken in that price range.”
Even as Bitcoin prepares to break out of the bottom, the bear-to-bull transition hasn’t quite formed due to the lack of a compelling influx of new demand.
Meanwhile, cryptocurrency trading company Cumberland recently highlighted that Bitcoin volume remained absolutely massive with around $50 billion worth of BTC derivatives being settled on crypto exchanges daily. Blockchain.News reported.
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