Some Cool On-Chain Data

So the rekkege has settled down a little bit, SO WHAT’S GOING ON NOW?!
Lets take a look at some cool data that can show us how the market is handling this dip.

Firstly, I think an important thing to notice is that the open interest is back down to the level it was in October when the BTC price was hovering around $41K-$43K, right before its recent pump.

Open Interest = The number of futures contracts open

This is awesome because we are holding a higher average price with the same amount of open interest, this is usually bullish because we were able to hold the higher level for a while, this pump was more sustained growth instead of as many spikes and drops, meaning we should have no problem getting back up there which pumps a ton of money in.

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Another thing we can look at, using the same derivative data, is the funding rate!

Funding Rates = The periodic payments that either the long or short trader pays to the other, based on the difference between the futures price and the spot price of a token.

Here we can see that the funding rate has gone negative, which means the short traders have to pay the long traders. This is for the first time since September right before and during the beginning of the most recent BTC pump.

This data can show bullish and bearish signs. The fact that we went back to 0% and then into the negative is a great sign because it means we got a full reset on the stacked-up leveraged long positions. The other side of this is that if it can continue to hold below and stay negative, it can drive the price of BTC down.

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Finally we can take a look at the number of addresses that are holding any amount of bitcoin greater than 0. We can see a bullish sign here with the fact that even though we just had this huge price drop, the number of unique addresses didn’t drop, meaning people are willing to hold or start investing in BTC at this time.

See the other big price drops like we just had? What happened to the number of addresses during those drops? It dropped BIG TIME compared to now, this shows a great amount of confidence in BTC.>

Just here to give some data that could help! If anything seems incorrect feel free to let me know!

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