Cryptocurrency investors who bought Bitcoin near its all-time high in 2017 bull cycle are in no rush to part with their coins.
According to a coin movement indicator called Hodl Waves, bitcoins, which moved in the past six to twelve months, now account for the largest share of cryptocurrency supply.
In other words, BTC purchased in late 2020 and early 2021 most often move, while other coins move less actively.
Note that the market does not look the best now, but many well-known representatives of the cryptocurrency community advise not to pay attention to this. In particular, the head of MicroStrategy, Michael Sailor, which owns more than 114 thousand BTC, yesterday recommended on Twitter not to pay attention to the Bitcoin exchange rate drawdown and «enjoy the journey» in the world of cryptocurrencies.
Enjoy the ride. #Bitcoin
– Michael Saylor ⚡️(@saylor) November 18, 2021
However, it is important to consider here that MicroStategy’s investment was the equivalent of $ 3.16 billion and is now valued at $ 6.38 billion.
Rating of public companies with bitcoins in the investment portfolio
What will happen to Bitcoin
Despite the rapid growth of the main cryptocurrency in 2021, a significant number of investors have not yet taken profits on it, that is, they have not sold coins. Recall that the Hodl Waves indicator itself tracks the date of the last movement of coins and displays their share in a convenient form on the chart. It shows that controlled BTC supply by later investors increased from 8.7 percent to 21.4 percent between June and November.
At the same time, bitcoins bought earlier than a year ago remain relatively less active. These readings support the theory that crypto investors are still choosing not to sell Bitcoin, despite the profitability of their cryptocurrency trades.
Hodl Waves indicator
Crypto analyst William Clemente noted that an indicator called dormancy flow – that is, Bitcoin’s market capitalization divided by a year’s period of inactivity of coins – remains relatively low. The higher the value of this metric, the closer the bullish trend is to its completion, since during this period most of the market participants are selling coins. Well, this, accordingly, leads to a rapid drop in their prices.
Here is Clemente’s commentary on this, in which the expert shares his attitude to what is happening. The quote is from the news outlet Cointelegraph .
Dormancy flow at such a low value indicates that the current bullish trend still has room for upward growth.
Dormancy flow indicator
Note that the majority of cryptocurrency market participants are now in a state of panic. Still, after reaching its new price record at the level of 69 thousand dollars, Bitcoin managed to adjust to a price minimum of 55 600 dollars. The cryptocurrency found the local bottom this morning.
Four-hour Bitcoin price chart
Although some analysts still view what is happening in the market as a healthy correction necessary for the further growth of the niche.
At the same time, Bitcoin became a hot topic in the Argentine government. It previously published a decree according to which transactions with cryptocurrency are now subject to taxation. Decrypt reports .
The exceptions provided for in this regulation and other regulations of a similar nature will not apply in cases where the movement of funds is associated with the purchase, sale, exchange, intermediation and / or any other transactions with cryptoassets.
Previously, cryptocurrency transactions between individuals in Argentina were tax-exempt and treated as if they were just regular currency transactions. Now, the cryptocurrency will enter the field of the country’s law, which to a certain extent serves as a clear sign of the recognition of Bitcoin among the members of the Argentine government.
This means that now the coin industry is heading towards legalization and its formation as a full-fledged asset in the modern economy. Recall that this is exactly what the cryptocurrency exchange Binance achieves, which on the eve published ten fundamental rights of users of digital assets. All of them ultimately boiled down to the fact that the niche lacks regulation, which in itself does not exclude innovation.
We believe that this behavior of investors not only speaks of their confidence in the further growth of Bitcoin in the future, but at the same time reduces the pressure of sellers on the cryptocurrency. In other words, the fewer people sell an asset, the less reason it has to crash. And in the current conditions for Bitcoin, this is very important.
