Journalist
Posted:
- The Bitcoin Supply Last Active metric noted an interesting development in recent weeks.
- This was positive for long-term investors in the coming months.
The crypto market has been trending higher since mid-October. This was evident from the steady increase in Bitcoin’s market capitalization [BTC], as well as the altcoin market cap. However, the growth was not isolated to BTC or Ethereum [ETH].
The breakout of resistance at round numbers of $30,000 in October was crucial, and another important psychological number was near BTC’s current prices.
Despite the rally past $44,000, the bulls’ inability to maintain control of the $42,000 support in recent days has raised concerns that Bitcoin has registered a local top.
In that scenario, prices would move lower over the next two months as the market recovers from the strong rally.
HODLers exhibit diamond hand tendencies
But despite these concerns, long-term BTC holders showed no desire to sell their holdings. Crypto analyst Will Clemente noted that more than 70% of Bitcoin’s circulating supply hasn’t moved in over a year.
The fact that over 70% of Bitcoin’s supply hasn’t moved in at least a year is an astonishing statistic in itself.
It’s even wilder when you consider the context that took place a year ago right after the FTX fell and BTC has risen almost threefold since then. pic.twitter.com/0wWpVWzFFT
— Will (@WClementeIII) December 12, 2023
AMBCrypto delved further into this observation to find out what the implications could be for Bitcoin investors. The metric in question came from the percentage of offerings that were last active from Glassnode more than 1 year ago.
Further analysis revealed that the metric trends were higher during the accumulation phase of the cycle. It starts to decline a few months before Bitcoin reaches its ceiling. This happened in 2020, and from September 2020 the trend started to go down.
Around October 2021, the price hit a local low before ticking higher again. That year represented Bitcoin’s highs around $60,000, which were reached twice in April and October 2021.
Therefore, the upward trend in supply that has been active in recent weeks suggested that the market was probably not approaching a top. Long-term investors could take some inspiration from this metric and maintain or even add to their positions.
A look at the address balances showed that whales were starting to slow down
Source: Santiment
AMBCrypto analyzed Santiment’s data to understand what holders of different sizes were up to. As expected, shrimp farms showed an upward trend, as has been the case for years.
Surprisingly, Shark and other smaller businesses have been down since late October.
This was a surprise because between 2017 and 2020, <1000 BTC holders trended higher in percentage terms. The decline between 2020 and 2022 was gradual, but accelerated dramatically after the implosion of the FTX.
Read Bitcoin’s [BTC] Price forecast 2023-24
Whale stocks rose rapidly between June 2022 and January 2023, but have slowly declined this year. This raised questions about whether the whales were slowly unloading after BTC rose above $30,000 to secure gains.
Are they waiting for another dive before they can increase their holdings? This is a question that only time can definitively answer.