17.04.2024

Large Bitcoin holders are in no rush to get rid of their cryptocurrency. What does it mean?

The number of liquid bitcoins – that is, those that can now be bought on exchanges – continues to decline rapidly. Over the past six months, only 36 percent of circulating coin supply has been moved to cryptocurrency networks, and the rest has been inactive.

At the same time, as noted by analysts of the Glassnode platform, closer to the global maximum of a bullish trend, the volume of liquid bitcoins usually reaches 50 percent. In other words, BTC holders are in no hurry to get rid of their crypto assets, expecting the continued growth of the Bitcoin price.

To begin with, we note that holding bitcoins and other coins is noticeably difficult now. The main cryptocurrency sank 7.7 percent over the past 24 hours to the level of $ 53,338 and traditionally pulled the rest of the market with it.

Here is a chart of the BTC rate for the last 14 days.

bitcoin chart rate

Bitcoin price chart for two weeks

Other members of the top ten of the overall coin rating also showed a drop – with the exception of XRP and Theta. For example, Ethereum is priced at $ 1,660, while Binance Coin is priced at $ 253.

Be that as it may, the trend remains unchanged. Investors continue to rely on the long term and withdraw their coins from cryptocurrency exchanges. Thus, they increase the safety of assets and protect them from possible sale on emotions.

What’s happening with Bitcoin

When the price reaches new highs, it is only natural for the «old» coins to be sold for profit by investors. However, this trend seems to be declining, which indicates the desire of investors to preserve their assets for the future. The current BTC supply is 18.66 million or 88.85 percent of the 21 million coin limit .

About a fifth of all BTC has been lost or stolen, meaning the actual amount of Bitcoin in circulation could be significantly lower. And this only increases the limitation of the asset.

Bitcoin cryptocurrency chart

Change in the volume of liquid bitcoins in circulation

Glassnode also noticed high activity in the Bitcoin network after the capitalization of the main cryptocurrency exceeded the trillion dollars mark . Many experts believe that this level is an important psychological threshold for many market players, that is, the capitalization of BTC is unlikely to ever drop below a trillion.

We checked the latest data: alas, this assumption turned out to be wrong. Today, the cryptocurrency has already managed to fall below the specified line of a trillion dollars, and its market capitalization has fallen to 996 billion. Of course, this is a minor drawdown, but Bitcoin still has the potential to decline even after hitting the trillion mark.

However, it should be noted here that the activity in the network, calculated on the basis of UTXO transactions, does not always signal the very activity of traders. These can be large transactions of the exchanges themselves between internal wallets, that is, in fact, the reflected situation may be incorrect.

In general, the main cryptocurrency has not been the most profitable investment of the past 12 months compared to the stock market. Lior Shimron, vice president of digital asset strategy at Fundstrat, shared his analysis of the market performance of the four largest publicly traded mining companies. These are Marathon Digital Holdings, Riot Blockchain, Hive Blockchain and Hut 8, each of which has a capitalization of more than a billion dollars , according to Cointelegraph.

Shimron found that the average return on these stocks over the past twelve months was 5,000 percent , while BTC rose «only» 900 percent over the same time period. Unsurprisingly, stocks had a “high positive correlation” with BTC, that is, a bond.

The researcher concluded that every moment the price of BTC rises by 1 percent coincides with the growth of the shares of the aforementioned companies by an average of 2.5 percent . However, this observation applies to both upward and downward price movements. This means that the stock is likely to fall significantly if BTC enters a correction phase.

By the way, this is not the first time Bitcoin has «lost» to shares. And although the cryptocurrency has shown incredible results since the summer of 2020, at least five companies have surpassed it in terms of growth rates. We wrote about them in a separate article.

We believe that the picture within the long-distance cryptocurrency market is positive. Investors still have no doubts about the main blockchain assets and buy them for a long-term holding on separate wallets. This means that, in general, the stage of growth continues, and drawdowns of the exchange rates of the type of today do not change anything.

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