According to an analysis by Glassnode, overall balance on Exchanges have seen an aggregate outflow of -750k $BTC since March 2020.
Q2 2022 alone has seen some 142.5k $BTC in outflows alone, a remarkable 18.8% of the total.
Moreover, prices traded down -37.9% in June 2022, competing only with the 2011 bear market for the crown of worst month on record.
According to the report, better performance is not anticipated, ‘with US inflation estimates for June 2022 remaining elevated, and storm clouds of a potential recession looming, the market remains heavily risk off. ‘
“The Bitcoin network is approaching a state where almost all speculative entities, and market tourists have been completely purged from the asset.”
Address activity, for example, has declined by 13% from over 1 million/day in November 2021, to just 870k/day of July 2022. This suggests little growth in new users, and even a struggle to retain existing ones.
Another metric used by Glassnode is Number of Active entities, where they collate multiple addresses and assign them to on-chain entities providing a more accurate and clear reflection of the more probable active user-base.
Based on this, Glassnode points out the initial hope post November 2021 ATH has since dissipated and there are around 244k Active Entities per day currently, which is languishing around the lower end of the Low Activity channel typical of bear markets (shown in red).
Most recently, the user-base growth rate has plunged to around 7K net new entities per day, which is similar to lows seen during the worst bear market levels in 2018 and 2019.
Still, the number of addresses with a non-zero balance continues to grind higher hitting a new ATH of 42.2 million and only minimally influenced by the recent capitulation drawdown.
“There are few reinforcements coming into the Bitcoin demand side, and thus prices are correcting until these HODLers can set the floor.”