On-chain metrics are characteristics of the blockchain that are used when conducting fundamental analysis of cryptocurrencies.
Almost every cryptocurrency has its own so-called explorer website, where you can view all these fundamental metrics.
So, we decided to look at these metrics$BTC Bitcoin and found some interesting pictures:
1️⃣ Exchange trading volume
This indicator displays the trading volumes of the BTC/USDT pair on the most liquid exchanges. And as you can see for the last 2 years, trading volume has been at a record low.
This means that now there is no particular interest of the masses in cryptocurrencies, which means that even at current prices it is not so bad to buy Bitcoin in the long term. Because judging by this metric, a surge in volume appears at a time when the price has already risen quite decently.
This does not mean that the price of Bitcoin will not go lower than the current one in our scenario 👇
2️⃣Average transaction confirmation time
We think it’s clear from the name what this metric reflects. And it is in this picture that we personally see another bearish signal, only this time it is fundamental.
Just look at what happens to the price of Bitcoin when the average confirmation time shows a strong increase. The price of Bitcoin begins to fall.
Right now we are experiencing a strong increase in confirmation times.
It’s quite simple to explain: people massively deposit Bitcoins into exchanges, which causes the mempool to become clogged. You can compare this to a queue in a store. Miners simply do not have time to process transactions.
3️⃣ Transaction cost
This indicator displays the average cost per transaction. As you can see, this indicator is completely correlated with the price of Bitcoin, but over the past year a strong discrepancy has appeared.
This is also a bearish signal indicating an inorganic increase in the price of Bitcoin, which means the price is growing artificially, apparently with the aim of driving the crowd into the market at local highs.
📊 Conclusion:
We have received another confirmation of the bearish scenario for Bitcoin. This time we looked at the fundamental indicators of the Bitcoin network. Add here the fall of indices, the general fundamental background and the bearish technical picture (read previous posts).
It is obvious that Bitcoin cannot go from current levels to conquer new peaks and the start of a full-fledged bull market should not be expected yet.
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