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Spike In New BTC Entities May Cause BTC Price Rise – Glassnode

There has been a surge in new BTC entities over the past seven days. Given the unstable downtrend in new BTC entities in the previous week, this is a good development. 

A Possible BTC Price Increase

The latest data from the on-chain analytics platform, Glassnode, revealed that the number of new BTC entities within the past week was about 112,600, hinting at a possible BTC price rise in the next few days.

Glassnode data for new BTC entities. Source: Glassnode

The data further revealed an additional 10K increase in new BTC entities between two weeks and last week. Hence, the report predicts that BTC price might surge towards the $50K level in the next few weeks if this trend continues.

An Astonishing Boost

The Russia-Ukraine war had caused a decline in the number of new BTC entities because the war has been impacting global financial markets negatively. But the rise in the new BTC entities indicates the global financial market, especially the crypto market, is gradually adjusting to the fallout from the war.

Coincidentally, there was a similar spike in the number of new BTC entities last September. A short while after their entry, BTC’s price rose tremendously, culminating in the new peak price of $69.5K set in November 2021. Hence, the Glass node data predicts that the entrance of these new BTC entities might have a similar effect like what happened last September – BTC price might shoot up in value within the next couple of days.

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Stagnant BTC Hash Rates Create Confusion

This past week, BTC’s hash rate rose to a new ATH. However, market analysts are confused about whether the momentum can remain the same. Preston Pysh, the host of a popular crypto podcast show, remarked that there is a change in BTC’s hash ribbon metric, indicating stagnancy in the hash rate.

MiningPoolStats (a crypto monitoring resource) revealed that the leading crypto had surmounted various challenges in the last 12 months to see its hash rate rise to an astronomical 221 EH/s this month. Mining operations have been dealt various considerable blows within the past 12 months. After china’s ban on crypto-related activities (which led to massive miners’ departure), Kazakhstan also banned crypto mining operations this year (another action that has negatively affected the crypto mining industry).

However, the crypto mining industry still recovered fully, proving that mining can never be wholly eradicated so long there is one region (no matter how little) willing to accept miners. Miners have a base amount to produce one BTC. When the BTC market price is less than this base amount, miners might consider closing shop since they can’t make a profit.

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The consequence is that price-performance is reduced, and the BTC network difficulty would need to be adjusted to ensure profitability for the miners. Besides the hash rate, analysts have also predicted that mining difficulty will surge by about 4.67% within the next week when the automatic readjustment will happen. They further predict that this subsequent adjustment may likely cause difficulty to reach 28.74m (a new peak record).


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Shelly Melancon (Switzerland)

Shelly is a cryptocurrency enthusiast from Switzerland, she bought her first crypto in 2015 when it was way less popular then it is today and since 2017 she has been writing about cryptocurrency for online news portals. Shelly is the newest addition to the Tokenhell team, she writes mostly news and reviews related articles , stay tuned to her posts to stay up to date with the crypto world.

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