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Bitcoin Nodes Surpasses 17,000 For The First Time In A Decade

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The number of reachable bitcoin nodes that run the network has surpassed 17,000 for the first time in a decade. According to Bitnodes, there are currently 16,814 publicly accessible nodes in the network, representing a 70% rise over the previous two years.

There were 10,000 nodes in 2020 and for most of the 2021 bull run, with Bitnode’s data going only as far as 2016 when there were 5,000 nodes.

Bitcoin nodes network growth, Nov 2023

The chart above is intriguing since it appears to suggest a trend in that every bull peak and cycle adds roughly 5,000 nodes.

Nodes reached 10,000 for the first time in years in November 2017, with nearly none of them using the Tor network at the time. IPv4 node numbers have now dropped to around 5,000, whereas Tor nodes have risen to 10,000 as of November.

Tor nodes increased by 2,000 in January 2020, just as the bull market was about to begin, while global node numbers stayed at 10,000. Tor nodes increased by another 5,000 in July 2021, 8,000 in December 2021, and 10,000 in March of this year during the banking crisis.

As a result, the new nodes correspond to an increase in bitcoin’s price, and hence to an increase in adoption. However, the fact that there are so many Tor nodes can be troubling because it is difficult to determine whether they are all managed by the same entity.

This network layer may or may not contain a 51% attack vector. There are, however, other possible attacks. Someone has to provide you with that history, another node, when you sync a new node. If only one individual has such history, they have the capacity to deceive, albeit it is unclear what the gains would be.

The solution is to sync from several nodes, however if just one person is running these ten thousand nodes, odds are that all of those multiple nodes are actually this one person.

A remedy is to declare that you only want to sync from IPv4 and IPv6 nodes, and only 10% of the time from Tor, or whatever percentage you wish.

This is especially crucial for Simplified Payment Verification (SPV) wallets, which rely on the node clients from whom they sync without full verification.

Read Also: A Uniswap User Lost $700,000 to an MEV Bot — But it Only Made $260

In theory, if these tor nodes are operated by a single individual, they can target such wallets to show that a transaction has been validated when it hasn’t.

If you are an exchange or another company that handles big crypto quantities, it is critical that you run your own node. When it comes to retail, an easy approach is to check Blockchain.info or whatever bitcoin explorer you like to see if their complete node claims it has been validated.

As a result, the attack paths are limited, and none are decisive when it comes to the network. Tor nodes, on the other hand, may have advantages because they are difficult to DDoS.

There are numerous other advantages. A report given at the China Cyber Security Annual Conference in December 2022, for example, reveals deanonymization of node IPs via cyberspace search engines that specialize in broad network level cataloging.

This type of effort could provide an even more autocratic Chinese government with the ability to cut out bitcoin at the network level. That may be more challenging with Tor nodes, especially if bitcoin developers continue to work on increasing encryption at the bitcoin network layer.

Furthermore, there is no evidence that these Tor nodes are run by a single body; it is simply a theoretical possibility.

A bitcoin node, on the other hand, requires resources. Storage is one of them, but so is bandwidth to maintain all of these connections, but it’s unlikely that these 10,000 nodes would cost more than $1 million, or at most $10 million.

That’s chump change for a government organization, and it might even be reachable for someone with a plan and some accomplishments.

However, because there would be no network-level dangers, the cost-benefit ratio would be unreasonably skewed toward cost if monetary gains were the goal.

There are also an estimated 100,000 inaccessible nodes, much above this 10,000, and you may always run your own node and sync just from IPv4 if you want to be really safe in this regard.

Otherwise, assuming they are organic nodes because they appear to match bitcoin price gains, it’s still more proof of demand growth even during the bear. That is theoretically supported by ethereum, which has increased its node count from around 5,000 to 7,500.

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Binance Lists ChainGPT (CGPT): Unlocking a New Era for AI-Powered Blockchain Solutions

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Binance Lists ChainGPT (CGPT): Unlocking a New Era for AI-Powered Blockchain Solutions – BitcoinWorld
































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$88K Critical for Bitcoin Momentum

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Bitcoin’s price trajectory is at a pivotal juncture, with $88,000 emerging as a key level for sustaining market momentum, according to on-chain analytics firm Glassnode. Using the UTXO Realized Price Distribution (URPD) metric, Glassnode emphasized the significance of the Short-Term Holder (STH) cost basis, noting minimal trading volume below this threshold.

The $88,000 level serves as a critical psychological and technical support, and a decisive loss could pave the way for further downside. This article explores the importance of this metric and what it could mean for Bitcoin’s future price movement.


Understanding Bitcoin’s STH Cost Basis

The Short-Term Holder (STH) cost basis represents the average price at which recently acquired Bitcoin has been purchased. This metric is essential for analyzing:

  • Price Momentum: Indicates the health of recent buyer confidence.
  • Support Levels: Highlights crucial price points where short-term investors are likely to defend positions.

At $88,000, the STH cost basis underscores its significance as a level where short-term traders might capitulate if breached, potentially triggering a larger sell-off.


The Role of the URPD Metric

Glassnode’s UTXO Realized Price Distribution (URPD) metric maps the distribution of Bitcoin trading volumes across different price levels. Key insights from the current analysis include:

1. Minimal Volume Below $88K

  • Glassnode’s data reveals limited trading activity beneath $88,000, suggesting weak historical support in this range.

2. Vulnerability to Downside Pressure

  • A breakdown below $88,000 could lead to accelerated selling, as short-term holders exit positions to minimize losses.

Why $88K Is Critical for Bitcoin

1. Psychological Benchmark

  • Round numbers like $88,000 hold psychological significance for traders, influencing decision-making and market sentiment.

2. Technical Relevance

  • The STH cost basis aligns closely with support and resistance levels derived from historical price action, making it a reliable marker.

3. Momentum Indicator

  • Holding above $88,000 would demonstrate resilience, while a breach could signal a shift in momentum toward bearish conditions.

Potential Scenarios Based on $88K Level

1. Holding Above $88K

  • Sustaining this level could reaffirm Bitcoin’s bullish momentum, encouraging accumulation by both short-term and long-term holders.
  • Positive macroeconomic news or institutional support could bolster price stability.

2. Breaching $88K

  • A decisive loss of $88,000 might lead to panic selling, increasing volatility and pushing Bitcoin toward lower support levels.
  • Traders may target $85,000 or lower as the next critical support zone.

Market Sentiment and Influences

1. Institutional Activity

  • Institutional investors closely monitor key levels like $88,000, adjusting strategies based on market strength or weakness.

2. Broader Economic Factors

  • Macroeconomic elements, including interest rate policies and inflation data, continue to impact risk assets like Bitcoin.

3. Short-Term Trader Behavior

  • As the primary holders at this cost basis, short-term traders play a pivotal role in determining Bitcoin’s near-term price movements.

How Traders Can Respond

1. Monitor Key Levels

  • Keep a close watch on Bitcoin’s behavior around $88,000, as this level is crucial for gauging momentum.

2. Set Stop Losses and Alerts

  • Traders should establish clear stop-loss levels to minimize risk in case of a breakdown.

3. Consider Accumulation Opportunities

  • If Bitcoin holds above $88,000, it could present a buying opportunity for those confident in a bullish continuation.

FAQs

1. Why is $88,000 significant for Bitcoin?
The $88,000 level represents the Short-Term Holder (STH) cost basis, a critical indicator of price momentum and market confidence.

2. What happens if Bitcoin drops below $88,000?
A loss of this level could trigger selling pressure, as short-term holders exit positions, potentially leading to further downside.

3. What is the URPD metric?
The UTXO Realized Price Distribution (URPD) metric tracks Bitcoin’s trading volume at different price levels, highlighting key areas of support and resistance.

4. How does $88K influence market sentiment?
Maintaining this level reinforces confidence in the market’s bullish momentum, while losing it could shift sentiment toward bearish expectations.

5. What should traders do at this level?
Traders should monitor Bitcoin’s performance around $88,000, set stop-loss levels, and consider accumulation if the level holds.


Conclusion

The $88,000 level is more than just a price point; it’s a pivotal marker for Bitcoin’s momentum and market sentiment. Glassnode’s analysis underscores its significance as the Short-Term Holder cost basis, with the potential to dictate Bitcoin’s next move.

Whether Bitcoin sustains this critical level or breaches it will determine its trajectory in the coming weeks. For traders and investors, staying vigilant and adapting strategies to this key metric will be essential in navigating Bitcoin’s dynamic market.

To learn more about the innovative startups shaping the future of the crypto industry, explore our article on latest news, where we delve into the most promising ventures and their potential.

Disclaimer: The information provided is not trading advice, Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Mantra Partners with UAE Real Estate Giant Damac to Tokenize $1B in Assets

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Mantra Partners with UAE Real Estate Giant Damac to Tokenize $1B in Assets – BitcoinWorld
































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