It has often been said in the past that Bitcoin (BTC) drives the entire crypto and blockchain industry. Is it still like this?
Bitcoin has hit highs over the past few months, including all-time high long-term holder rates and local highs in hashrate difficulty adjustment, but Bitcoin is still in a bearish state as we head into Q4 2022.
Not all areas of the blockchain industry can boast such signals of strength as venture capital (VC), which brought in $840,000 in October, down 48.6% from the previous month. Similarly, there has been a continued drop in sales of non-fungible GameFi tokens, even though there were 10% more active players in October than in September.
At the same time, regulation continues to pose a looming threat from entities such as the U.S. Securities and Exchange Commission, which is currently looking into the possibility that ether (ETH) is a security, given that 46.65% of Ethereum nodes are in the United States.
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Each month, Cointelegraph Research releases the Investor Insights report, which analyzes key metrics from various sectors of the blockchain industry such as regulation, crypto mining, security tokens, bitcoin and ether derivatives, and VC activity.
Another positive bitcoin signal
Bitcoin is trading above its 50-day moving average (MA), with the 100-day MA acting as resistance and the Moving Average Convergence/Divergence (MACD) histogram signaling a bullish trend. Online data and historically accurate readings suggest the bottom may be close. In addition, the MVRV-Z reading has been in the green since the end of June, suggesting that Bitcoin has bottomed out.
On Nov. 2, post-FOMC volatility was short, with the trading range consolidating around the $20,000 level. Aside from the FOMC, volatility could emerge following the US midterms and Q3 earnings from cryptocurrency giants MicroStrategy, Coinbase, Block and Robinhood, all of which occur in November.
The fundamentals of Bitcoin are still strong, and the asset that started it all for crypto is likely to help keep the industry ultimately on course for the rest of the bear market, even if it could encounter some volatility along the way. But, fortunately, 1 BTC continues to equal 1 BTC.
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The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations to any person or any particular security or investment product.