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Bitcoin sees a rise in new addresses as doubts around Silvergate impact BTC



Bitcoin sees a rise in new addresses as doubts around Silvergate impact BTC
Source: Pixabay

  • The number of new Bitcoin addresses has hit a three-month high.
  • However, concerns over Silvergate contributed to a drop of nearly 5% in the BTC price.

Price fluctuations in Bitcoin [BTC] have been driven in the past by both individual and institutional investors. Recent developments, however, indicate that one party has far more sway than the other over the direction of the price.

Read Bitcoin (BTC) Price Prediction 2023-24

Enter, retail investors

There has been an increase in the number of new addresses on the Bitcoin network, according to data from Glassnode. The gradual increase in Bitcoin prices occurring recently also coincided with the increase in new addresses.

Bitcoin new addresses

Source: Glassnode

On 2 February, 505,298 new addresses were registered, as measured by the Glassnode metric. A thorough examination of the graph confirmed that it was the most significant number the network had seen in the preceding three months.

Also, November 2022 is the only month in the preceding five months to have seen statistics similar to, but somewhat higher than, November 2022.

According to Alicharts, the rising number of Bitcoin addresses is cause for optimism. As a result, barring any negative effect from institutional actors, the asset’s price may rise even more, signaling growing confidence in BTC.

The institutional players’ effect

When we consider the role of institutional actors, we see that the price of Bitcoin has been negatively affected by the collapses of exchanges like Mt.Gox, Terra, and FTX. Bitcoin was still trying to burst beyond the $24,000 barrier, but recent news might have dampened the rally.

In less than an hour on March 3, the price of Bitcoin [BTC] dropped from $23,500 to $22,240, a drop of almost 5%. There was widespread unease about the future of the crypto-friendly bank Silvergate Capital, which contributed to the decline.

According to CoinMarketCap data, the price decline reduced Bitcoin’s entire market capitalization by $22 billion.

The curious case of Silvergate

Silvergate is a leading cryptocurrency bank that has established relationships with key trading platforms. The crypto-friendly financial institution has put off submitting its yearly 10-K report to the SEC (SEC).

Due to more significant losses in its fourth fiscal quarter last year compared to what was initially reported in January, the bank notified the SEC that its financial condition could be different than previously revealed. 

The bank had also reportedly voiced concern over the lack of clarity in crypto rules. As a result, companies and exchanges dealing in cryptocurrencies have distanced themselves from banks. This includes the likes of Circle, Coinbase, Bitstamp, and Galaxy Digital.

BTC enters a bear trend

The price of Bitcoin was still struggling to recover from the fall, as of this writing. It was trading at $22,000 and had lost more than 4% on a daily timeframe.

The recent slump has also caused the price to move below the short Moving Average (yellow line). The Relative Strength Index (RSI) line had crossed below the neutral zone, signaling it had also entered a bearish trend.

Bitcoin (BTC) price move

Source: TradingView

 How much are 1,10,100 BTCs worth today

Bitcoin optimism?

Despite the recent decrease in the price of Bitcoin (BTC), there wasn’t panic. Exchange deposits did not seem out of the ordinary, according to the Exchange Netflow data from CryptoQuant.

At the time of writing, there were fewer than 200 deposits on exchanges, even if there were more deposits than withdrawals. Yet, as the story unfolds, it’s critical to consider how institutional and retail investors respond and affect price movement.

Bitcoin Exchange Netflow

Source: CryptoQuant

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Ser Suzuki Shillsalot has 8 years of experience working as a Senior Investigative journalist at The SpamBot Times. He completed a two-hour course in journalism from a popular YouTube video and was one of the few to give it a positive rating. Shillsalot's writings mainly focus on shilling his favourite cryptos and trolling anyone who disagrees with him. P.S - There is a slight possibility the profile pic is AI-generated. You see, this account is primarily used by our freelancer writers and they wish to remain anonymous. Wait, are they Satoshi? :/

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