The recent recovery in Bitcoin and Ethereum prices has not been accompanied by a fundamental improvement in on-chain indicators. According to Glassnode analysts, this does not give confidence to a fundamental change in the market situation.

#Bitcoin and #Ethereum It rose strongly from the bottom and reached above the Realized Price.

Attention is now turning to whether this is a bear market rally or fundamentals are following support.

Read more on The Week On-chain 👇https://t.co/taOkbeVlyv

– glass knot (@glassnode) August 1, 2022

Doubts that the upside dynamics will continue after the actual price is exceeded by quotations creates the status of on-chain indicators.

The number of active bitcoin addresses remains within the downtrend channel. Peak in October-November was lower than reached in April 2021 ATH.

Except for short bursts during capitulation periods, network activity remains low, indicating a small influx of new demand.

A similar picture emerged when looking at the number of transactions, fees and block occupancy. Analysts found similarities between the current situation and the events of 2018 and 2019. After the initial “cleanup” and destruction of demand in May 2021, transaction activity has dwindled somewhat. This only indicates that it has a stable base of interested traders and investors.

Similar trends are observed in the Ethereum blockchain. Despite the recent strong price action, the network load in terms of number of transactions has been systematically falling to the lowest levels since summer 2020 since May 2021.

In recent weeks, there has been an increase in activity that analysts associate with the consolidation of coins in wallets. They announced that if this trend is sustainable, they will change their minds.

The median value of gas price over the past seven days has dropped to 17.5 Gwei, the lowest since May 2020, marking the start of the DeFi summer. In other words, there was no influx of new users. Experts highlighted that many indicators of Ethereum activity are at multi-year lows.

A certain optimism for Glassnode analysts is inspired by the Output Profit Ratio Spent (SOPR).

In Bitcoin, the indicator is trying to break above the border 1 level for the second time since the beginning of June. The ideal bullish scenario would be to break above this mark and then test as support, they explained.

In Ethereum, a similar breakthrough, which was later tested again, has already occurred as support. Experts warned it could be unstable due to poor network activity.

Glassnode experts previously warned that it would take additional time for Bitcoin price reversal.

Recall that Grayscale analysts allowed the completion of the crypto winter by the end of March 2023.

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