Over the past few months, Bitcoin’s on-chain activity has been on the rise. Compared to its 2019 levels, this year has witnessed a massive surge. This signals a strong fundamental strength, as it indicates that more entities and individuals are interacting with the Bitcoin network at a higher rate than seen during last summer’s rally. We can also infer that Bitcoin may be in a far better position currently than it was during previous rallies.
The flagship crypto has been witnessing a strong uptrend throughout the past few weeks. It began its uptrend from lows of $9,000 level and broke many resistances to record multi-months high above $12,000 level. Though the BTC price is currently in a short-term correction phase, it still seems to be well-poised to continue its rally in the coming sessions.
A prominent analytics firm, Glassnode, recently noted that BTC’s “Market Cap to Thermocap Ratio” indicates that the crypto is undervalued at the moment. According to Glassnode, this metric indicates if an asset is trading at a premium with respect to the total revenue generated by the network. The analytics firm identified BTC’s current value to be at very low levels, “5-10x away from previous tops”.
One notable metric, which also suggests that the Bitcoin network is being heavily interacted with, is the surge in the number of unique addresses. This indicates an influx of new investors, which may account for Bitcoin’s recent technical strength. BTC’s latest uptrend is likely to continue for long since a large number of investors are backing it.
Moreover, this metric is currently near where it was in the 2019 rally, though BTC’s price is still significantly lower. Because the metric is also far below where it has been during past uptrends, it gives an indication that BTC might still have more room to increase.