- The “Bitcoin Supply Last Active” metric has seen an interesting development in the last few weeks.
- This was positive for long-term holders in the coming months.
The crypto market has been on an upward trend since mid-October. This has been evidenced by the steady increase in Bitcoin's market capitalization [BTC]as well as the altcoin market capitalization. However, the growth was not limited to BTC or Ethereum [ETH].
Breaking through the round figure resistance at $30,000 in October was crucial, and another important psychological number was close to current BTC prices.
Despite rallying past $44,000, bulls' inability to maintain control of the $42,000 support in recent days raised concerns that Bitcoin has reached a local high.
In this scenario, prices would tend to decline over the next one to two months as the market recovers after the strong recovery.
HODLers are showing diamond hand tendencies
However, despite these concerns, long-term BTC holders showed no desire to sell their holdings. Crypto analyst Will Clemente noted that over 70% of circulating Bitcoin supply has not moved in over a year.
See more
The fact that more than 70% of Bitcoin supply hasn't moved in at least a year is crazy in itself.
Things get even wilder when you consider the context, which was just after FTX crashed a year ago and BTC has risen almost threefold since then. pic.twitter.com/0wWpVWzFFT
— Will (@WClementeIII) December 12, 2023
AMBCrypto dug deeper into this observation to find out what implications this could have for Bitcoin investors. The metric in question comes from the percentage of the last active offer 1+ years ago from Glassnode.
A deeper analysis showed that the metric is trending higher during the accumulation phase of the cycle. A few months before Bitcoin hits its ceiling, it begins to decline. This happened in 2020 and from September 2020 the metric started decreasing.
It hit a local low around October 2021 before trending back up. This year, Bitcoin peaked around the $60,000 mark, reaching it twice in April and October 2021.
Therefore, the recent active uptrend in supply in recent weeks suggested that the market is unlikely to be nearing a peak. Long-term investors could take inspiration from this metric and continue to hold on to their holdings or even increase them.
A look at the address balances showed that the whales had started to slow down
Source: Santiment
AMBCrypto analyzed Santiment’s data to understand what holders of different sizes were up to. As expected, shrimp stocks showed an upward trend, as they have done for years.
Surprisingly, the shark and other smaller populations have stagnated since the end of October.
This was a surprise as the percentage of <1000 BTC holders tended to be higher from 2017 to 2020. The decline from 2020 to 2022 was gradual but accelerated massively after the FTX implosion.
Read Bitcoins [BTC] Price prediction 2023-24
Whale populations rose rapidly from June 2022 to January 2023 but have slowly declined this year. This raised questions about whether whales are slowly unloading after BTC surged above $30,000 to lock in gains.
Are they waiting for another dip to start adding to their inventory? This is a question that only time can definitively answer.
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.