The perception of the current wave of Bitcoin growth as a bull trap or an opportunity for strategic buying will predetermine the mood of long-term investors. These are the conclusions made by Glassnode analysts.
The recent market rally has pushed #Bitcoin prices above $23k, surprisingly many investors.
However, with higher prices comes an increased motivation for network participants to take exit liquidity, especially after the boom bear of 2022
Read here 👇https://t.co/D5QY9n5dp7
— glassnode (@glassnode) January 23, 2023
The wave of growth in digital gold from the lows of December brought a significant part of the supply of coins into profit, creating incentives for speculators and miners to close positions. Since January 8, the balances of the latter have decreased by 5600 BTC.
The share of “profitable” coins in the total supply over the past two weeks has jumped at a record pace compared to previous bearish phases – from 55% to 67%. Analysts attributed this to a significant number of bitcoins that have changed hands at prices below $23,300.
The return of metric values to the corridor of 55-80% is associated with reaching the bottom and transition to a balanced state.
The volume of realized profits exceeded the corresponding figure for realized losses. Before that, the opposite situation was observed, and against the backdrop of the collapse of the Terra and FTX ecosystem, two capitulations took place in the equivalent of 2.9% and 3.7% of the capitalization of the first cryptocurrency.
The greatest spending took place in the “youngest” coins – from a day to six months. During 2021 and most of 2022, they played an increasingly smaller “role” in the dynamics of the costs of market participants.
The current price after 6.5 months exceeded the “cost” of bitcoins at the disposal of hodlers ($22,600). In this regard, the current bear market was comparable to what happened in 2018-2019. At the moment, “paper losses” of long-term investors reached an average of 33%.
Since the beginning of December, the number of coins “aged” over six months has increased by 301,000 BTC. This is an indicator of confidence in the sustainability of the current rally.
The monthly accumulation rate of hodlers has reached 100,000 BTC. After the FTX crash, they were getting rid of bitcoin at a “rate” of 314,000 BTC per month.
In the last week, long-term investors gave stability to quotes, who continued to accumulate coins. According to experts, this is a marker that hodlers continue to believe in the prospects of the first cryptocurrency and bet on a bullish macro trend.
“Surveying their spending is likely to be the key thing to monitor in the coming weeks,” the experts said.
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I’m Meagan Diaz, a news writer and author at World Stock Market. My main focus is on technology and stock market trends, and I’m passionate about helping readers stay informed on the ever-changing landscape. I bring extensive knowledge of the industry to my work as well as a knack for storytelling that makes my articles both accessible and engaging.