On-Chain Data Shows Bitcoin Network Is Growing Stronger Than Ever

The Bitcoin network is looking more and more resilient by the day, as proven by some freshly-released on-chain data.


  • Bitcoin Illiquid Supply
  • Bitcoin Hash Rate
  • BTC Price Update

Bitcoin took another dump in the last 24 hours, briefly breaking down below the $40,000 psychological barrier. Despite the uncertainty in the greater macroeconomic landscape, underlying on-chain data is showing that whales and retail alike are not going anywhere — they’re actually stacking Bitcoin faster than ever before.


Bitcoin Illiquid Supply

If you’re not familiar, the illiquid supply represents the amount of Bitcoin that has been moved from exchanges to wallets with no previous history of selling. A lack of selling history can indicate two possibilities: for one, it can mean that those wallets have been around for a while and are not touching their coins (in anticipation of further appreciation). Two, it could represent Bitcoin being moved into a new wallet, meaning that brand new users are joining the market.

As highlighted by Bitcoin Archive, the illiquid supply of Bitcoin is not only going higher, it’s going parabolic.

Although the price has yet to catch up, we can see from the first bullish wave of this cycle that the Bitcoin price moved in tandem with its illiquid supply. Since the initial crash in May 2021, Bitcoin has been moving to dormant/new wallets basically non-stop, and the rate at which that’s happening looks to be speeding up too.

There’s no telling when Bitcoin could turn around in the short term, but if history is a reliable indicator, then we should expect to see the king crypto asset turn around in a big way as supply continues to shrink.


Bitcoin Hash Rate

The next metric is one of many analysts’ favorite: the Bitcoin hash rate. This metric essentially tracks the “liveliness” of the Bitcoin network. As the hash rate increases, that means that there is more Bitcoin mining taking place across the board.

As pointed out by the highly-respected on-chain analyst Will Clemente, the hash rate is surging to new all-time highs, telling us that Bitcoin, despite the haters calling it “dead,” is more “alive” than ever before.

If you weren’t around in 2021, that nosedive in the middle of this hash rate metric was spurred on due to China’s ban of Bitcoin mining in the country. Even when the most Bitcoin-mining-dominant country in the world decided to cut off mining completely, the Bitcoin network managed to stay afloat like the ban never even happened. Perhaps the most recent impulse in hash rate can be attributed to Russia, as the country’s president Vladimir Putin announced that Russia would be setting up a proper legal framework for Bitcoin mining in the country.

Bitcoin Price Update

Taking a look at the price chart, Bitcoin (BTC) admittedly does not look as bullish as indicators would suggest. However, as we know, Bitcoin never likes to let the market be right for too long.

At the time of writing, BTC is trading at $39,865.

BTC Price

As you can see, Bitcoin broke out from a longer-term downtrend dating back to November 2021. Now that BTC broke support at $42,000 it’s looking like it wants to head down further, though any analysis must be taken with a grain of salt. Technically speaking, we could see Bitcoin drop down to the $34-$36,000 region to restest that downtrend line as support and still maintain bullish structure. However, a further breakdown even lower could tell us that Bitcoin may have a ways further to go before fully recovering.

If you’re a fundamental believer in Bitcoin, then the current price swings should do nothing to deter you. You probably don’t need much reassurance, as Bitcoin has never failed to recover to new all-time highs in its 13-year history, but the latest illiquid supply and hash rate metrics are here to reinforce that Bitcoin is not going anywhere.