Glassnode analysts told how long-term and short-term bitcoin holders navigate the current market conditions – now only short-term investors are selling BTC.
In a YouTube video, the analysts said that their study relied on metrics from HODL waves that show how bitcoin holders from different age groups use the cryptocurrency. Glassnode claims that despite the current correction in the cryptocurrency market, long-term Bitcoin holders continue to hold cryptocurrency.
“We are seeing a balance of bitcoin going in and out of exchanges, and short-term holders are the most intimidating cohort,” the analysts said, explaining that short-term traders buy bitcoin and sell it as soon as they see cryptocurrency prices drop.
“People buy a dip and then it turns out it wasn’t the last dip, so they sell again and then buy again. They create the fluctuating dynamics that you can see on stock charts. For every bitcoin withdrawn from the exchange, the same amount of bitcoins comes in a week.”
Analysts noted that the transition of bitcoins into the hands of long-term investors is a constructive sign. However, if the scenario changes and long-term holders start selling their bitcoins, this would indicate that the bearish scenario is getting stronger.
“A more bearish scenario where we see the HODL wave metric starting to rise again is that coins held in wallets are starting to sell. This means that some of the long-term holders are losing confidence,” the researchers concluded.
Glassnode recently reported that bitcoin investors began hedging risk to protect themselves from the Fed’s rate hike this March.
Source: Bits
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