Despite lateral movement, the omens for Bitcoin remain good.
Bitcoin’s (BTC) share price performance was mainly sideways in September, with the price decline of Altcoins and DeFi-Kryptos adding to the difficulties.
Therefore, although the share price lacks momentum, the on-chain data indicate that the Bitcoin block chain is gaining new participants in large steps.
Although Bitcoin has not yet been able to capitalise on this, cryptanalyst Willy Woo is confident that this is a very strong omen, he wrote on 30 September:
„The entry of new network participants has not yet had an impact on Bitcoin’s share price, but this has always been the case. As a trader, this is what we call a divergence, which is to be seen as positive in any case“.
Bitcoin: Number of new entities vs price
Bitcoin: New participants compared to the course. Source: Glassnode
As can be seen from the above chart, the number of new Bitcoin network subscribers has increased significantly since last week, significantly exceeding the August figures.
Where do the new subscribers come from?
Some experts suspect that the increase in new Bitcoin subscribers is due to the downturn of the Altcoins and DeFi tokens. In the past 30 days, these have each lost double-digit amounts, which may have prompted many crypto investors to flee towards Bitcoin.
In addition, the current „strength“ of the market leader could have an attractive effect. Although the share price has repeatedly failed recently at the 11,000 US dollar mark, Bitcoin has nevertheless managed to establish itself above the 10,000 US dollar mark.
Moreover, in view of the continuing uncertainty and economic weakness in the wake of the Corona crisis, Bitcoin may increasingly prove to be a reliable store of value.
Even though the US dollar is the most sought-after financial product in times of crisis, a second wave could mean another severe blow to the global economy. Many investors would then turn all the more to „safe havens“ such as gold and Bitcoin, especially if the US dollar were to depreciate.