Trust crypto nosedives. 5 Things to Expect from Bitcoin This Week – Cryptopolitan

Bitcoin begins the last week of February in an uneasy mood as a critical area of ​​resistance fails to break. Bitcoin rose above $24,000 in Asian afternoon trade on Monday, but the top ten non-stablecoin cryptocurrencies remained mixed. Ether gained 0.18%, while Solana gained the most among the top ten cryptos.

The current media climate surrounding crypto and blockchain technologies is filled with cases of fraud and deception. While these cases are not all cryptocurrency-related, such as FTX’s misappropriation of customer funds, they undermine faith in the broader crypto business, especially among investors, lawmakers, and regulators.

Bitcoin Whales’ numbers plummet

Since the launch of Bitcoin in 2009, blockchain and its applications have evolved significantly. With the emergence of smart contracts, new consensus processes and new types of governance, the technology has developed in different directions.

Assets have also increased and are now held by millions worldwide and by major players, including organizations such as BlackRock and JPMorgan Chase and governments such as El Salvador and the Central African Republic.

On Sunday, there were the lowest number of Bitcoin whales or wallet addresses with 1,000 or more BTC since August 2019. According to crypto analysis service Glassnode, there were 2,027 whales on Sunday, February 19; the last time their number was this low was on August 5, 2019, when it was 2023.

Source: Glassnode

The fact that each whale has about $25 million in Bitcoin at the current price of about $2,500 shows a significant level of confidence in the digital currency.

The peak number of Bitcoin whales, a little around 2,500 in February 2021, has gradually declined since then. Despite a market rebound between February and March 2022, when the number of whales increased from 2,117 on 21 February to around 2,286 on 23 March, this pattern persists.

A similar tendency does not occur among so-called megawhales, individuals who own more than 10,000 BTC, which in today’s prices represents an investment of more than 250 million dollars.

There are only 117 mega whales, which is relatively close to the historical peaks of 123 in November 2022 and 126 in October 2018. Historically, their behavior has been far less linked to the price of Bitcoin.

Despite the wide variations in the price of digital currency over the past five years, the number of smaller investors in BTC, wallets with more than one coin, has gradually increased over the past five years with some falls.

The number of wallets with more than one Bitcoin now stands at 982,000, a significant increase from approximately 814,000 this time last year and 788,000 in February 2020.

Source: Glassnode

Bitcoin performance expectations for the week

BTC/USD is back below $25,000 after a classic “fakeout” during low-volume weekend trading, with bulls still lacking strength. But last week, the biggest cryptocurrency appeared to be entering the next phase of its 2023 recovery, with rapid gains and even reaching new six-month highs.

The good times were not to last, however, as February’s rally was significantly slower and more difficult to achieve than January’s 40% rally. So what will the rest of the month bring?

TradingView data showed that BTC/USD recouped losses from the weekly near $25,000 barrier again at the time of writing. But bulls failed to trigger a resistance-support switch, and whale activity on exchanges raised concerns.

All eyes are on the FOMC meeting and the US markets

It remains to be seen what form this “weakness” in the macro markets will take. The coming week has fewer possible macro triggers than the last, with a smattering of US data releases, including personal spending in the form of the Personal Consumption Expenditures Index (PCE).

However, the release of the minutes of the Federal Open Market Committee (FOMC) meeting in February is the event on most cryptoanalysts’ radar. This is where the latest benchmark interest rate hike was decided, with hopes that Fed Chair Jerome Powell will include, if only in theory, language about a pause in rate hike policy.

“We also have the FOMC minutes on Wednesday where Powell will describe what a ‘pause’ might look like […] In the middle of the coming week, I will start considering swing posts.” cryptanalysts

Still, not everyone believes that the FOMC minutes will be easy to understand. Capital Hungry, a financial market research website, warned this week that “sneaky hawkish revisions” could be released.

Investors look at the BTC hash rate

As the month draws to a close, Bitcoin’s network fundamentals maintain the bullish sentiment, a common bright spot.

The next automatic readjustment will struggle to add an estimated 10 percent to the existing total. Unfortunately, this will undo the small reduction caused by the previous adjustment, making it difficult to reach new all-time highs.

This is a critical metric for gauging the sentiment of Bitcoin miners, as such high spikes signal increased competition for block subsidies. It comes on the back of increased coverage of so-called “ordinals” fees, with a visible increase in profitability for miners after months of pressure.

BTC Fear and Greed Index

Bitcoin may not be able to sustain a rise above $25,000, even if it manages to break through solid resistance at that level. However, recent research from research firm Santiment reveals that cryptocurrency market sentiment is becoming excessively bullish near these multi-month highs.

The ever-popular Crypto Fear & Greed Index indicates that “greed” is the dominant sentiment in the cryptocurrency market this week. The Bitcoin rally corresponded with a reading of 62/100 for the index, establishing new highs since the BTC/USD rally to $69,000 in November 2021.