Few weeks pass like the weekly scenario currently taking place in the crypto market, which is surprisingly calm.
Glassnode has published a report on Bitcoin, the state of its network, and how the network looks fundamentally strong, despite the slow price movement.
Describing Bitcoin as an impressively quiet week, Glassnode confirmed that volatility is declining as the price of Bitcoin remains constrained to the $32,500-$34,900 range.
Quoting from the Glassnode report :
The calm before the storm is set in motion as silent, calm activity emerges across both positional, derivative and on-chain scales.
At the time of writing, Bitcoin is down 1.69% on the day, still below $34,000 during the Asian morning trading session.
Bitcoin is still moving sideways, although the movements are dwarfing in breadth.
Bitcoin mining activity recovery:
Glassnode indicated that mining activity is slowly returning to normal, noting that offline miners are the pressure to sell bitcoin while being offset by a buildup by online miners.
There has also been a rise in the hash rate since it reached its lowest level since August 2019 on June 28, when it fell to 68 EH/s, according to Bitinfocharts.
The current hash rate is up 32% since those levels to 90 EH/s indicating that nearly a third of hash power has returned online since the historic low.
According to Glassnode, this could be because miners in China have successfully moved the hardware or dusted off the old hardware and found a new lease.
Bitcoin exchange flows:
Another measure that supports the accumulation theory is the exchange outflows from the trading platforms, which have been increasing over the past two weeks.
Usually when traders prepare to sell, they move their bitcoins to central exchanges for conversion into fiat or stablecoins, which is what happened in April and May.
Glassnode noted that on a 14-day moving average basis, the past two weeks have seen Bitcoin exit the exchanges, at a rate of close to 2,000 BTC per day.
She added that the on-chain transaction fees associated with exchange deposits have decreased while the fees associated with withdrawals have increased, and Glassnode concluded the following:
Continuation of this as a structural trend may reinforce the hypothesis that the sell-side pressure is easing.
Long periods of sideways price action usually lead to a big move, but it looks like a major sell-off has already taken place according to Glassnode data.