How Did Bitcoin Start 2022?
Bitcoin starts the first week of 2022 without any surprises or sharp jumps in the rate from below $50,000, however, continuing the trend of several previous weeks.
Popular trader and analyst TechDev agreed with analyst Michael Van de Pope’s statement that the $48,000 level is like a “little brick wall” for Bitcoin rate.
Analyst Pentoshi and others suggested switching to Ethereum (ETH) due to the strengthening of altcoins, thus providing a convenient way to “mitigate risk” when Bitcoin’s performance is poor.
This strength is reflected in the dominance of Bitcoin’s market capitalization, which dropped below 40% for the first time since May, TradingView data shows.
In a newsletter issued on December 31, Capriole CEO Ryan McCoy emphasized that trends in investor buying habits are in line with the latest rounds of previous adjustments.
Of particular interest is the Short-Term Holder Spent Profit (SOPR) withdrawal ratio from network analyst Glassnode, which shows the degree of profit or loss on coins spent over the past 155 days.
Currently, with an average score below 1, SOPR shows that the number of coins spent at a loss is declining – a potential form of seller attrition.
McCoy explained that when this indicator first falls and then rises, a more stable price trend begins.
Hodlers continue to hold onto their Bitcoins despite a 38% drop since November, McCoy added.
Miners do the same by hoarding rather than selling their coins. At the same time, the network hash rate is at an all-time high since March 2021. This speaks to the faith of miners in the long-term profit of Bitcoin.
The hash rate is currently over 190 exahashes per second (EH / s), according to MiningPoolStats.
Meanwhile, later this week, the difficulty of the Bitcoin network will rise by about 2.4%.
According to Blockchain data, the difficulty of mining Bitcoin will soon reach 25 trillion again. With each increase in complexity, network security grows, creating an even more reliable ecosystem.
The Crypto Fear & Greed Index started 2022 at the “extreme fear” level. It climbed 8 pips over the weekend, although there was virtually no price movement. At the time of writing, the index was 29/100 – the “fear” zone.