- Derivatives and spot trading volumes and exchange outflows have declined over the past month.
- However, the number of long-term holders of Bitcoin has continued to increase.
Bitcoins [BTC] The upward trajectory has hit a roadblock in recent months, dampening growth and raising concerns. Specific statistics pointed to a decline, which could be a major contributing factor.
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However, amid this apparent stagnation, the number of steadfast long-term holders remained remarkably stable, demonstrating resilience.
Bitcoin is seeing a drop in key metrics
A recent article from CryptoQuant shed light on why Bitcoin price growth has been slow lately. The decline of two key BTC metrics and one stablecoin metric significantly impacted this slow progress.
The key metrics were BTC trading volume, exchange outflows, and stablecoin inflows.
An analysis of these statistics for July showed that they had experienced a decline. Both BTC spot and derivatives trading volumes showed no significant daily spikes compared to previous months, according to CryptoQuant.
The highest volumes recorded in July were on the 6th and 14th of the month. On July 6, spot trading volume reached approximately 114,000, while derivatives surpassed 1.3 million. On July 14, spot trading was at 104,000 and derivatives at over 988,000.
Source: CryptoQuant
However, these highs were lower than those of previous months, indicating a decline in overall trading activity.
In addition, the rate of BTC outflow from exchanges declined in July, as shown by the BTC outflow chart. While some days showed impressive outflow numbers, the overall trend indicated that more holders were depositing their BTC on exchanges rather than withdrawing it.
Source: CryptoQuant
In addition, the inflow metric of the stablecoins exchange was analyzed, which revealed a noticeable decline. The chart showed a sharp drop in stablecoin inflows on the exchanges, suggesting a reduction in buying pressure.
Source: CryptoQuant
These dips in key metrics suggested that sentiment around Bitcoin was bearish at the time of writing. The implication was that the price of BTC would likely experience difficulties in making significant gains.
Bitcoin long-term holders are rising
Despite Bitcoin’s stagnant growth, the community of long-term holders remained undeterred and continued to grow. A fascinating insight from Glassnode’s offering last active chart revealed an upward trend in the two-year band.
This band represented about 47% of the total supply at the beginning of the year. However, at the time of writing, it has risen to over 56%.
Source: Glassnode
This significant increase in the bond indicated that more holders had withdrawn their assets from the exchange. In addition, these assets have remained unaffected by trading activity for the past two years. Essentially, this suggested that a growing number of investors were determined to hold on to their Bitcoin for the long haul.
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BTC decline continues
Bitcoin’s daily timetable chart showed that the price decline continued. At the time of writing, the price was trading at a decline, even though it was down less than 1%. Specifically, it was trading at around $29,100, indicating a continuation of the downtrend.
The decline was further confirmed by a fall in the Relative Strength Index (RSI), indicating strong selling pressure.