Bitcoin [BTC] network adoption has dipped to ‘bear market’ levels and could derail any expected strong recovery in the short term.
According to on-chain analyst JA Maartun, BTC network activity ‘slowed’ below the yearly Moving Average (365-day MA). This mirrored ‘bear market’ levels seen in 2022 and 2018.
The indicator tracks key network adoption elements, including active addresses, block space demand, and transaction count per block.
Per the chart, historically, such slowed adoption capped BTC upside in the near term.
BTC — Is accumulation on?
Even recent whale and miner movements leaned towards the above weak sentiment. Per another separate CryptoQuant update, whales offloaded 30K BTC last week. That’s nearly a $2.5 billion dump, assuming an average of $82K per BTC.
Additionally, miners offloaded half of the amount dumped by whales (15K BTC) as their profit margin reduced to 33%, according to CryptoQuant.
These sustained downward pressures dragged BTC accumulation to its lowest levels since February.
Even so, BTC has stayed above $80K for over a week. According to Bloomberg ETF analyst Eric Balchunas, the BTC price resilience was due to strong U.S. spot BTC ETFs and Michael Saylor’s massive bids.
For his part, Glasnode stated that some whales were already bidding at current levels despite the weakness, citing the Accumulation Trend Score metric.
“Bitcoin’s Accumulation Trend Score is currently at 0.34 – the highest it’s been year-to-date. This suggests that, on aggregate, wallets are beginning to re-enter accumulation mode, with larger cohorts stepping in modestly despite recent price weakness.”
Simply put, some large players didn’t view the current values as selling levels, but entry levels to add into positions.
However, the Coinbase Premium Index showed that demand from U.S. retail was at neutral levels and could go in either direction.
A sustained move higher by the Coinbase Premium Index could reinforce increased demand for BTC recovery to extend. On the contrary, a dip lower would drag BTC prices again.
Source: AMBCrypto / Digpu NewsTex