Bitcoin, the leading cryptocurrency, has seen a remarkable journey over the past few years. Recently, it reached a milestone of $52,000 before encountering a barrier. Despite trading below this significant psychological threshold, the sentiment surrounding Bitcoin remains optimistic. Long-term holders of Bitcoin have been observed to collectively sell about 200,000 BTC from their stash since the beginning of the year. This selling trend has persisted for nearly three months, with their balances consistently decreasing during this period.
When comparing this current trend to the behavior of holders during the previous bull market, there is a notable difference. During the previous bull market, holders reduced their BTC balances by approximately 15%. However, in the current scenario, the decrease amounts to only around 1.5%. This suggests that while long-term holders are still selling some of their Bitcoin, they are doing so at a much slower pace compared to before. This cautious approach indicates a potential shift in investor behavior amidst the current market conditions.
On the other hand, there has been a significant increase in Bitcoin inflows into accumulation addresses, reaching an all-time high of 25,300 BTC. These addresses, characterized by no outgoing transactions, holding a balance exceeding 10 BTC, and consistent activity over seven years, suggest a strategic effort by major holders to accumulate Bitcoin in anticipation of future price increases. In addition, there has been a noticeable decrease in the amount of Bitcoin held on exchanges since mid-March 2020. Initially, over 17% of Bitcoin’s supply was on trading platforms, but this percentage has decreased to 11.79% as of YTD.
Most recently, whales in the cryptocurrency space have been observed moving significant amounts of Bitcoin from exchanges to non-exchange addresses. In one instance, over 18,000 BTC, estimated to be worth around $1 billion, were transferred from Coinbase to multiple non-exchange addresses, speculated to be custodial wallets. This movement indicates a potential shift in the behavior of large holders towards storing their assets in more secure, non-exchange wallets.
Overall, the current state of Bitcoin reflects a complex interplay of selling behavior among long-term holders, increased accumulation in specific addresses, and a gradual decrease in the amount of Bitcoin held on exchanges. These trends suggest a cautious yet strategic approach by investors in response to the evolving market conditions.
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