Investors based in Asia have been sellers, while those in the US and EU have been buyers with only one short exception for the past two years.
The Bitcoin network on-chain activity still appears to be in a bear market as the U.S. and E.U. buyers. As they are, struggling to stay ahead of sellers based in Asia.
Blockchain analytics firm Glassnode’s latest report on the weekly activity of the Bitcoin (BTC) network shows that the price of the largest crypto by market cap has stayed firmly within the same tight $5,000 range from $37,680 to $42,312. However, on March 22, the asset saw a sudden spike in price, which elevated prices to a two-week high.
Overall, the network is in a demonstrable lull, according to Glassnode’s weekly review:
“Bitcoin network utilization and on-chain activity remain firmly within the bear market territory, albeit recovering.”
The research concluded that there is a distinction in the behavior of the average BTC investor based on their geography. Notably, U.S. and E.U.-based investors have been buyers, whereas Asian investors have been sellers. This tendency had remained consistent since March 2020, except for last November, when both sides were buying heavily.
Pressure Remains Asia Dominated
Specifically, Glassnode researcher and report writer “Checkmate” pointed out that U.S. and E.U. investors have offered general bid support for the past two years. There is a heavy buying between late 2020 and early 2021. However, “both regions capitulated throughout May-July.” E.U. buyers are currently providing the largest amount of support.
Conversely, Glassnode reported that Asian markets have offered lower buying support through Q1-Q3 of 2021 and currently produce heavy selling pressure. However, on March 22, co-founder of crypto investment firm Three Arrows Capital Su Zhu tweeted, “Asia unironically max bidding BTC,” suggesting that Asia-based traders led the day’s short-term upswing in price.
Several on-chain metrics suggest that a bear market is well underway. The number of new entities — or new wallets that are not associated with existing wallets. There’s been a gradual upswing since mid-2021. This bear market pattern played out similarly from January 2018 through the first half of 2020. There are currently about 110,000 new entities created on the Bitcoin network per day.
In a bear market, new entity growth increases slowly and steadily. In bullish periods, new entity growth experiences large spikes, like in January 2018 and January 2021.
