Bitcoin to Repeat 2017 Bull Run Based on This Key Metric: Analyst

Bitcoin bulls have a lot of reasons to be excited. On Wednesday, the top cryptocurrency posted a fresh 2020 high of $9,443.96. It’s also up over 30% year-to-date and it continues to show signs of strength.

The top cryptocurrency is close to breaching the resistance of a key metric. I’m talking about the number of entities entering bitcoin on a daily basis. The growth of entities strongly suggests that more people are using the cryptocurrency. This metric is relevant because the last time adoption grew, the cryptocurrency launched a bull market.

Getting the actual number of bitcoin holders or users is a herculean task. To get a good gauge of widespread adoption, blockchain intelligence firm Glassnodes mapped the number of entities controlling multiple addresses. For now, this is the closest you can get to approximating the number of bitcoin holders.

With that in mind, Glassnodes charted the daily net growth of entities. Again, this is a metric that more closely measures how many users are using bitcoin. That’s because it’s mapping multiple addresses to a single entity. In addition, this metric takes into consideration entities with zero BTC balance but had a non-zero BTC balance before. It’s not surprising to see that bitcoin’s price rose while the daily net growth of entities increased.

For instance, bitcoin ignited its parabolic run in October 2017. This coincided with more new users creating their bitcoin addresses. Then from April 2019 to June 2019, bitcoin skyrocketed from $5,000 to nearly $14,000 which also coincided with the rise in new users. I believe that the prevailing bullish sentiment will foster the growth of new entities. If history is any indication, bitcoin’s price could be poised for a breakout.