02.03.2024

Experienced investors keep hoarding bitcoins while newbies sell cryptocurrency

The meteoric rise of the main cryptocurrency has not shaken the faith of long-term holders of Bitcoin in its future. They have been slow to take profits in this growth cycle so far, while individual investors who have joined the industry more recently are much more likely to trade the coin.

According to a chart from analysts at Unchained Capital, which clearly shows the time that has passed since the last transactions of crypto wallets on the network, in 2021 there is an increase in both long-term and short-term activity of cryptocurrency holders.

We checked the current data: there really is a reason to accumulate bitcoins. Today, the cryptocurrency is valued at $ 56,895, which is only 2.7 percent lower than the historical record for the BTC rate. At the same time, over the past day, the coin managed to overcome the line of 58 thousand dollars, so that before the record of 58 640 dollars there was not much left at all.

Bitcoin price chart for March 12, 2021

bitcoin chart rate 58 thousand

In general, the growth results of the first cryptocurrency are more than acceptable. For example, in two weeks it grew by 22 percent, while the increase in the rate over the last year is equivalent to 1008 percent.

bitcoin growth rate

Bitcoin performance over time

What’s happening with Bitcoin?

The graph shows that the number of coins moved from wallets in the last 30–90 days is at its highest level since 2018. These addresses account for over 15 percent of total wallets and are currently the largest segment of BTC holders, Cointelegraph reports.

Crypto wallets, which have remained inactive for three to five years, are currently the second largest segment, accounting for 13.5 percent of all addresses . The number of these wallets has also steadily increased throughout 2021. It is assumed that this number includes a significant part of people who bought BTC before 2017 and kept coins throughout the entire bearish trend of the crypto market.

This means that they have more experience and understanding of what can happen in the cryptocurrency market next. Therefore, they continue to hold coins and wait for an even better time to buy.

Blockchain cryptocurrency Bitcoin

The colors indicate the activity of different types of crypto wallets in terms of value against the background of the growth of Bitcoin

While the proportion of wallets that have been inactive for 5-10 years tentatively declined over the past year, the number of addresses that have been inactive for at least ten years has increased from about 1.7 percent to 10.7 percent in two years .

In short: those who got into the cryptocurrency industry two years ago and earlier are actively selling their coins. Longer-term holders, on the other hand, only accumulate bitcoins.

In other words, seasoned market players already have an understanding of Bitcoin bull cycles and their enormous upside potential. They are waiting for the continuation of the upward movement of BTC in the long term, and right now there are no factors that would prevent Bitcoin from quickly reaching new all-time highs.

Blockchain cryptocurrency Bitcoin

Balance change on different types of crypto wallets

By the way, one of the key triggers for a new wave of rising prices for the main cryptocurrency may be the next round of distribution of «free money» by the US government. President Joe Biden recently signed a $ 1.9 billion stimulus order. The first major round of distribution of money began in April last year.

Blockchain cryptocurrency Bitcoin

Increase in the value of an investment in Bitcoin

Then the Americans received checks for $ 1200 . Many of them invested this money in the crypto market, which in part gave rise to a new bullish trend in BTC. This investment in Bitcoin has paid for itself in full: by today, then $ 1,200 invested in BTC today would have been equal to $ 10,211 . That is, the amount of return on investment is more than 750 percent .

And this is far from the maximum for the cryptocurrency industry. If the user invested $ 1200 in Ethereum on April 15, 2020, he would be able to purchase 7.5 ETH. At today’s exchange rate, this is approximately $ 13,325, which means that the growth in this case is proportional to 1010 percent.

We believe that the current situation can be called a classic for the coin market. Less experienced traders and holders are more prone to emotions, so they are more actively parting with cryptocurrency. Moreover, when the rate begins to rise, investors buy the same volumes of crypto – but at a higher price.

At the same time, experienced investors use collapses not to sell and fix losses, but to buy an asset at a better price. And as their results show, this scheme works much more efficiently.

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