Bitcoin Margin Funding Rate Jumps
• Positive funding rates suggest speculators are bullish on Bitcoin.
• The cryptocurrency recently printed fresh 8-month highs at $25,270.
• A surge of new investors is likely helping drive the recent gains seen in Bitcoin.
Recent Price Jump
Bitcoin recently saw its price jump to eight-month highs at $25,270 earlier this week, before pulling back to the upper $23,000s. The positive price movement of the last few days has also resulted in a spike in liquidations of Bitcoin future short positions according to crypto analytics website coinglass.com.
New Investor Influx
Crypto data analytics platform Glassnode reported that the number of wallets with a non-zero balance recently surged above 44 million for the first time, driven by an influx of new wallets with small BTC balances (presumably retail investors). Wallets containing under 0.01 BTC (so-called „plankton“ addresses) and those containing under 1 BTC (so-called „shrimp“ addresses) both hit all-time highs above 32 million and 43 million respectively – suggesting more and more new investors are entering the market.
Realized HODL Ratio
The Realized HODL Ratio takes the ratio between coins that are one week old and coins that are one to two years old; when this ratio reverses it can be an indicator that a new bull market is beginning and new investors are returning to the market once again – as was seen during Bitcoin’s recovery following its bear market at the end of 2018/start of 2019.
Can New Investors Keep Pumping?
The recent surge in new investor numbers could help maintain or even increase Bitcoin’s current upward momentum – however there is no guarantee that this will be sustained in future if prices start to decline again or if a large enough portion of these newer investors decide to cash out their profits quickly following any further increases in price.