There are currently more Bitcoin keys with at least one satoshi associated with them than there has ever been before. The number of plus balance addresses is even higher than it was at the peak of the 2017 bull market.Â
The figures, although problematic, give something of an indication of the number of Bitcoin users around the world. Despite the record numbers of plus balance Bitcoin wallets, the price remains a long way off its 2019 all-time high but some believe the current downtrend is close to a bottom.
All-Time-High: 28.39 Million Addresses Hold Some Amount of Bitcoin
The news of the all-time high in plus balance addresses comes from venture investor Alex Thorn (@intangiblecoins). Using data from CoinMetrics.io, he identified that the number of addresses holding any amount of Bitcoin has surpassed the previous all-time high of 28.38 million, achieved at the height of the bull market of 2017.
The total number of bitcoin addresses that hold any amount of BTC has hit an all-time high at 28.39M addresses, surpassing the previous ATH of 28.38M (achieved on 1/10/18). (Data via @coinmetrics Pro)
Short thread
pic.twitter.com/y87ovxstWb
— Alex Thorn (@intangiblecoins) December 6, 2019
In a series of tweets following that above, Thorn states that the number of Bitcoin addresses with a positive balance is one of the best ways of determining how many individual Bitcoin users there are worldwide. He does, however, identify two major caveats with the metric. Firstly, there is nothing to suggest that each address represents a single user. Users can have many wallets and wallets often have multiple addresses. Alone, this would make the number of positive balance addresses much larger than the cryptocurrency’s user base.
Indeed, Satoshi Nakamoto even outlined the importance of users switching up addresses at the very beginning of Bitcoin’s story. In the whitepaper itself, the Bitcoin creator writes:
“As an additional firewall, a new key pair should be used for each transaction to keep them from being linked to a common owner.”
Clouding the figures’ accuracy further is the fact that huge numbers of Bitcoin users choose to leave their digital currency on exchanges. By doing so, their holdings will sit at an address with the Bitcoin of many other users. This would make the number of positive balance addresses much smaller than the actual user base.
Thorn reasons that the large number of people holding Bitcoin on exchanges makes it more likely that the 28.39 million plus balance addresses is less than the true number of users. He summarises that, although far from perfect, the rising number of plus balance addresses is a sign of growing Bitcoin adoption.
Another investor, Timothy Peterson of Cane Island Alternative Advisors, believes that similar data can be used to determine a local bottom in the market. Peterson says he is prepared to call a bottom to current downtrend when the median price of Bitcoin over the last 30 days comes in line with the number of active addresses reported by CoinMetrics. He also mentions other, unnamed indicators as supporting the theory that we are nearing a local bottom in the market.
In about 2 weeks this median #bitcoin price will be substantially lower at ~$7300, which is more in line with where active addresses sit today. I think I can safely call a bottom at that time. I also have several other indicators that say the 2019 bubble is fully popped. pic.twitter.com/OZSlrNOjVX
— Timothy Peterson (@nsquaredcrypto) December 6, 2019
Related Reading: Prominent Analyst: Bitcoin Likely on Cusp of Making a Major Price Movement
Featured Image from Shutterstock.
The post Number of Plus Balance Bitcoin Addresses Hits All-Time High, is the Bottom in? appeared first on NewsBTC.
