04.03.2024

How Bitcoin investors with different backgrounds behave at this stage of market growth

According to the research platform Glassnode, 95 percent of the bitcoins currently featured in transactions have been mined by miners over the past three months. And only 5 percent of the coins used in transactions are older than 90 days.

In other words, now the vast majority only move “young coins”, while the rest of the bitcoins are stored in the wallets of investors or on exchanges. In addition, addresses holding BTC for at least three years have significantly increased the volume of the asset in the last 6-12 months , while new holders have been fixing profits since the beginning of 2020.

To begin with, we note that obtaining such data on the activity of cryptocurrency holders allows an open blockchain, information in which anyone can get. The so-called UTXOs or the withdrawals of unspent transactions allow judging the age of certain coins.

In fact, these are the remainders of the cryptocurrency that the user receives to his wallet after each transaction. Thanks to UTXO, it is possible to determine when a particular coin was last moved.

We analyzed this topic in detail using the example of Bitcoin in a separate article. We recommend that you familiarize yourself in order to better understand what is happening in the blockchain.

What is happening with the cryptocurrency market

Glassnode analysts classify «long-term holders» of the main cryptocurrency as those who have held bitcoins for more than 155 days . Accordingly, short-term holders are investors who move coins later than this date. Experts note that the first category of market players has more experience, accumulates BTC during bearish trends and fixes some of the profits in a bull market. The second category prefers to make transactions with coins much more often , according to Cointelegraph.

At the moment, approximately 10.85 million BTC – or 58 percent of the circulating volume of coins – at the disposal of long-term holders can be sold for a plus since the moment they last moved on the blockchain.

Likewise, only 5.3 million BTC from short-term holders’ wallets can be sold at a profit. This means that experience still makes itself felt and allows you to act more confidently in various situations. As a result, it ends up with more profit.

Bitcoin trading chart

Potential losses of two types of investors

In addition, analysts have identified another interesting detail: most of the market players in the first category now hold more coins than during the previous bull cycle. There is also an increased influx of new Bitcoin users, which is quite natural against the backdrop of the rapid growth in the price of cryptocurrency in the past and at the beginning of this year.

By the way, about newly minted crypto investors. It is likely that most of them will enter the market with money printed by the US government the day before. These are aid checks amid the fight against the fallout from the COVID-19 pandemic. This weekend, US President Joe Biden signed a $ 1,400 order to the Americans . In total, the government spent $ 1.9 trillion on this economic assistance program .

Experts have announced in advance that some of this money will be used to purchase cryptocurrency. And in general, due to the partial depreciation of the dollar against the background of the mass emission, coin rates should also go up.

Bitcoin trading chart

The volume of the influx of new users against the background of bullran breaks all records

According to a recent survey by investment bank Mizuho Securities, 2 out of 5 people who receive checks are going to spend money on investments. Most of them consider Bitcoin as their main investment, Decrypt reports. During this survey, experts from Mizuho Securities asked for the opinion of 235 respondents . Their average age reaches 41 years, and the average income is about 55 thousand dollars a year.

The firm estimates that at least $ 40 billion of economic aid could be poured into the crypto market. This is a fairly serious amount, even considering the fact that Bitcoin’s capitalization now exceeds the trillion dollars mark . In general, we believe that making such conclusions, taking into account the small number of people interviewed, is a rather hasty decision. However, in any case, the receipt of checks by the Americans should positively affect the value of both traditional and digital assets.

We believe the findings from analysts’ reports are positive. Seasoned investors who have already experienced one stage of growth in the cryptocurrency market in 2017 see the potential in coins and expect to capitalize on their price jumps. And this is a logical decision, taking into account the payments of financial assistance to residents of the United States, who can send money specifically to purchase Bitcoin and other coins.

Now fans of blockchain assets have to wait and watch what is happening in the niche. Most likely, the massive influx of deposits and the purchase of coins from newly minted cryptocurrency investors will be noticeable on the charts.

Leave a Reply

Your email address will not be published. Required fields are marked *