Glassnode’s realized capitalization of Bitcoin would show according to a shared post a potentially disastrous outlook for the leading cryptocurrency in the market, Bitcoin, should the trend continue. In this sense, Bitcoin could experience a drop in its price.
Bitcoin could have a drop in its price
Despite some big fluctuations, Bitcoin’s price has been surprisingly stable for the past two months, rarely leaving the $ 9k-10k range.
However, the latest Glassnode “Realized Capitalization” figures would indicate that Bitcoin could experience a drop in its price.
Capitalization performed is a novel statistic designed by the Glassnode team. Which calculates the size of the market, according to the price that Bitcoins had in each unique direction of the Blockchain, the last time they moved.
In this sense, if we have 1 BTC in our wallet, bought at $ 7,000 and 2 BTC bought at 8,000, Glassnode adds the $ 7,000 of the first BTC and the 8,000 of the second, instead of calculating both at the current market price.
“The capitalization realized values different parts of the supplies at different prices (instead of using the current daily closing). Specifically, it is calculated by valuing each UTXO at the price of the last time it was moved. ” In Glassnode’s words.
Consequently, the fact that Bitcoin’s realized capitalization increases indicates that many of the BTCs currently on the market have been purchased at high prices. That is, they have probably been recently acquired.
Now, there are two scenarios: a new record in the realized capitalization of the cryptocurrency, may indicate an upward trend in the market. Or the less optimistic scenario.
Well, the previous historical record in the capitalization of BTC was reached in early March, just before the 49% drop in the price of Bitcoin due to the Coronavirus crisis. Therefore, there would be no causal relationship between this metric and an increase in the price of the cryptoactive.
Which can open the doors to a drop in the price of Bitcoin.
Changpeng Zhao believes that nothing will ever be the same after COVID-19
Changpeng Zhao, the CEO of the world’s largest exchange, Binance, said in an interview with Forbes that the world will never be the same again after the end of the pandemic that has paralyzed the world, the coronavirus.
In this context, the CEO of Binance considers that after this collapse people should be trained. He has also reiterated the role that Bitcoin and cryptocurrencies play during this crisis.
“The pandemic has changed the world as we know it; will never be the same again. And in this new world, we believe that cryptocurrencies will play an increasingly important role. “
Global Blockchain Spending to Slow Down According to IDC
An IDC report shows that spending on blockchain solutions has decreased in 2020 across the board.
According to a report, global blockchain spending will decrease this year. IDC’s report runs counter to forecast spending for the current year. This is due to reduced spending on information technology (IT) and a general slowdown in economic growth.
Globally, spending on blockchain solutions is expected to reach $ 4.3 billion this year. This figure represents a 57.7% increase from 2019 when $ 2.7 billion was spent.
At the same time, it means a 7.7% decrease regarding pre-COVID-19 predictions. The declines in question will not be uniform but will manifest themselves in certain sectors and regions.
In a few lines…
- Bitcoin.com introduced a new service that allows users to send any amount of Bitcoin Cash (BCH) via email.
- Hyundai is reportedly looking to launch a blockchain ecosystem through its Europe-based subsidiary Hdac and IT arm Hyundai BS&C, after registering three trademarks with the Korean Intellectual Property Office.
- China gets its first blockchain-based public resource tender platform.