Research: 65% of Bitcoin’s circulating supply has not moved in the last 12 months Andjela Radmilac · 2 hours ago · 1 min read
The 65% illiquid supply illustrates an interesting trend — investors are holding their coins both through bull markets and crypto winters.
1 min read
Updated: August 5, 2022 at 1:22 pm
Cover art/illustration via CryptoSlate
The notion that an active market is healthy isn’t always true. While the amount of activity we see on a given network can undoubtedly show how stable it is, a lack of activity can also indicate an incoming bullish trend.
Take, for example, the Bitcoin network.
Bitcoin’s price slump hasn’t affected the majority of its circulating supply. According to data from Glassnode, over 65% of Bitcoin’s circulating supply, or around 12.35 million BTC, hasn’t moved in at least a year. This is a significant increase from the supply that hasn’t been active in at least two years and an even more considerable increase from the supply that hasn’t been active in at least three years.
Data from Glassnode shows that 8.55 million BTC — 45% of the circulating supply — hasn’t moved in at least two years, while 7.22 million BTC — or 38% of the circulating supply — hasn’t moved in three years.
Zooming out even further to the supply that hasn’t moved in five or more years, we see it trending towards all-time highs of 4.37 million BTC, or 23% of the supply.
This illustrates an interesting trend — investors are holding their coins through bull markets and crypto winters. Bitcoin’s ATH rally in November 2021 hasn’t decreased the percentage of Bitcoins held in over a year, and neither has the ongoing bear market. The data suggests that investors have a low-time preference view and are holding onto their coins through thick and thin.
TA: Bitcoin Price Takes Hit, Why BTC Remains at Risk of More Losses
Bitcoin price started a fresh decline from the $24,250 resistance zone against the US Dollar. BTC declined below $23,000 and remains at a risk of more losses.
- Bitcoin started a fresh decline below the $23,500 support zone.
- The price is now trading below the $23,500 level and the 100 hourly simple moving average.
- There was a break below a major bullish trend line with support near $23,320 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The pair must clear the $23,250 resistance to start a fresh increase in the near term.
Bitcoin Price Breaks Support
Bitcoin price struggled to gain pace above the $24,000 resistance zone. The price formed a top near $24,285 and started a fresh decline.
There was a clear move below the $23,800 and $23,500 support levels. The bears pushed the pair below the 61.8% Fib retracement level of the upward move from the $22,846 swing low to $24,286 high. Besides, there was a break below a major bullish trend line with support near $23,320 on the hourly chart of the BTC/USD pair.
Bitcoin price is now trading below the $23,500 level and the 100 hourly simple moving average. It is now consolidating above the key $22,650 support zone.
Source: BTCUSD on TradingView.com
On the upside, an immediate resistance is near the $23,250 level. The next key resistance is near the $23,500 zone. A close above the $23,500 resistance zone could start a steady increase. In the stated case, the price may perhaps rise clear the $24,000 resistance.
Downside Break in BTC?
If bitcoin fails to clear the $23,500 resistance zone, it could continue to mov down. An immediate support on the downside is near the $22,650 level.
The next major support now sits near the $22,500 level. A close below the $22,500 level might start a move towards $22,000. If the bears remain in action, there is a risk of a move towards the $21,500 level in the coming sessions. Any more losses might send the price towards $20,500 level.
Hourly MACD – The MACD is now gaining pace in the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now well below the 50 level.
Major Support Levels – $22,650, followed by $22,500.
Major Resistance Levels – $23,250, $23,500 and $24,000.
Weekly crypto asset flow has these profit-making statistics
Inflows into digital asset investment products totaled $3 million last week, bringing the sixth consecutive week of inflows to a total of $529 million, CoinShares found in a newly published report.
Last week’s inflow represented a 96% decline from the $81 million recorded in inflows the previous week.
Inflows into digital asset investment products totaled $3 million last week, bringing the total inflows since the beginning of the month to $3.1 million.
CoinShares found that last week’s inflows represented 1.7% of the total assets under management (AuM). It further stated that despite the market downturn in the last quarter, 32 new investments have been launched, primarily in altcoins.
Bitcoin and Bitcoin-short in the last week
According to the report, last week, Bitcoin logged outflows. These outflows totaled $8.5 million. The outflows recorded brought the year-to-date (YTD) inflows for the king coin to $311.9 million, a decline from the YTD index of $326.1 million recorded in the previous week.
Still, a king, Bitcoin’s YTD inflows represent 63% of the YTD total inflows of $492 million recorded by all assets considered by CoinShares in the report.
Further, Coinhares found that short-Bitcoin investment products also recorded outflows that totaled $7.5 million. That was the second consecutive week of outflows for short-Bitcoin. In the previous week, it saw outflows of $2.6 million.
These outflows, according to CoinShares, suggest that “investors believe bitcoin prices have troughed.”
What about Ethereum?
For Ethereum, inflows in the last week totaled $16 million, bringing it to its near seven consecutive week run of inflows of $159 million.
“We believe this turn-around in investor sentiment is due to greater clarity on the timing of The Merge where Ethereum shifts from proof-of-work to proof-of-stake,” CoinShares stated.
The report, however, stated that on a YTD basis, the leading alt had seen outflows of $300 million.
Regionally, most inflows were from North America and Europe, with inflows from the United States and Germany totaling $16.8 million and $7.8 million, respectively.
All other regions considered in the report registered inflows except Canada, which saw an outflow of $29.9 million.
Commenting on the reason for the low weekly inflow, CoinShares, thus, stated:
“Despite improving sentiment, trading volumes remain very low at US$1.1bn for the week versus the year-to-date weekly average of US$2.4bn. We believe the low participation is seasonal as a similar trend has been seen in previous years.”
Why Are Crypto Investors Rotating From Bitcoin To Altcoins?
The crypto market is pulling back into support and could face potential headwinds in the short term. In the crypto top 10, Bitcoin has been outperformed by the altcoins sector with Ethereum and Binance Coin, and Polkadot still preserving some of its gains from the past week.
This shows a shift in the crypto market dynamics as investors seem to be regaining confidence in the sector and moving away from Bitcoin. Therefore, the number one crypto by market cap appears to be lagging which translates into a decline in Bitcoin dominance.
As seen below, this metric has been moving sideways since May 2022 after seeing a small push to the upside. In 2021, as Ethereum and other altcoins reached new all-time highs, Bitcoin dominance plummeted to its current levels.
If the current trends continue, Bitcoin lagging the altcoin sector, the metric could re-test its yearly lows and drop from 43% into the high 30% area which could provide altcoins with more room to reclaim previously lost territory.
According to a report from Arcane Research, their Crypto Indexes for altcoins have been showing positive returns in August. As seen below, the research firm records 9%, 7%, and 5% profits for their Large, Mid, and Small Cap Index while Bitcoin records 2% profits.
The latter shows the biggest increase as risk exposure trends upwards, and stablecoins market shares follow a similar trajectory as that of the Bitcoin dominance. Arcane Research noted:
With bitcoin underperforming relative to altcoins, the bitcoin dominance has plummeted from a peak of 47% in the middle of June to 40.5% now. As the market sentiment has improved traders have been more interested in getting exposure to altcoins than bitcoin.
In the crypto market, altcoins might continue to dominate in the short as BTC’s price moves sideways. Thus, investors seeking higher returns might consider rotating into Large to Mid-cap cryptocurrencies, and Small Cap if they have bigger risk tolerance.
Why Is The Crypto Market Seeing Short-Term Downside Price Action
Despite a positive month for the majority of the crypto market, most cryptocurrencies are experiencing downside price action on low timeframes. This is due to the potential short-term impact of the macro-economic factors affecting the sector.
Tomorrow, the U.S. Federal Reserve (Fed) will release July’s Consumer Price Index (CPI) print. This metric is used to measure inflation in the U.S. dollar, which has been trending upwards and stood at a 40-year high.
Thus, the Fed has been hiking interest rates and shifting its monetary policy in an attempt to slow down inflation. If July’s CPI print hints at success in those attempts, the financial institution might be inclined to act less aggressively.
This could lead to a stronger bullish momentum across risk-on assets, such as Bitcoin and the crypto market. In the meantime, market participants seem to be sidelined and expecting tomorrow’s outcome. A pseudonym trader said the following on the above:
CPI relation with Bitcoin. Now that gas prices are lowering, we’ll see a decrease or inflation holding/cooling. This will give confidence back to investors. Fed rate lowers to 50 bps at next FOMC meeting, showing optimism to investors. Don’t get shaken out before the move up.
Monero Faces Pressure In Keeping Upward Pace – Will XMR Overcome Resistance?
Monero has its hands full trying to keep its momentum and rally forward. But, it must first overcome obstacles. As...
TA- Binance Coin Continues To Look Strong Despite Altcoins Shakeout
The price of Binance coin (BNB) continues to look strong as it holds its support against Tether (USDT) after the...
July’s CPI Report Shows US Inflation Cooling — Critics Say ‘US Government’s Formula Understates The Actual Rise In Prices’
After last June’s inflation report published by the U.S. Bureau of Labor Statistics indicated that the Consumer Price Index (CPI)...
Defi Attacker Siphons $570,000 From Curve Finance, Crypto Exchange Fixedfloat Freezes 112 Ethereum
Reports indicate that the decentralized finance (defi) protocol Curve was hacked for $570,000 in ethereum after people noticed that Curve’s...
Biggest Movers: AVAX Nears Highest Level Since May, ETC Moves Towards $40
Avalanche rallied on Wednesday, as the token broke out of a key resistance level on its way towards a multi-month...
German Crypto Exchange Nuri Files For Insolvency
Cryptocurrency exchange Nuri has filed for insolvency, reportedly becoming Germany’s first fintech to take the step in a challenging year...
Report: Nearly 13,000 Chinese Social Media Accounts Promoting Virtual Currency Closed
Nearly 13,000 Chinese social media accounts that allegedly promoted virtual currency investments were closed, the Cyberspace Administration of China recently...
Decentralizing The Internet: How Wayru Is Bringing People Together With Blockchain
sponsored In 2011 the UN released a report declaring the internet a Human Right, but over a decade later millions...
Current Mortgage Refinance Rates, August 10, 2022 | Rates Move Higher
Advertiser Disclosure Jason Stauffer Jason Stauffer Staff WriterAdvertisement Jason Stauffer is a personal finance reporter who previously covered the housing...
USDT volume on exchanges up 20% in 3 months
USDT volume on exchanges up 20% in 3 months Oluwapelumi Adejumo · 6 mins ago · 2 min read According...
Axie Infinity holders have reasons to celebrate market drawdown
The market crash has affected every cryptocurrency in some or the other way. And, the recovery from the same has...
What’s changed in GameFi in the last month? – July Report
What’s changed in GameFi in the last month? – July Report Footprint Analytics · 2 hours ago · 7 min...
How To Make Money From Ethereum Name Service?
Learn how you can use ENS to become rich We all love to reap the benefits of advanced technologies, but...
Degrain (DGRN) Continues To Thrive In Bear Market, Outshines Litecoin(LTC) And Polkadot(DOT)
In this article, we examine why the coin on the block, Degrain, has been thriving while Litecoin and Polkadot have...
HUMAN Protocol’s Big Announcement On V2 Upgrade With Routing Protocol
The voting model will utilize HUMAN Protocol Reputation Oracles to adjust voting power. Last week, HUMAN Protocol announced the introduction...
Report: Samsung Signs MOU To Build Galaxy NFT Ecosystem
Korean electronic goods producer Samsung Electronics recently signed a memorandum of understanding (MOU) with six companies that will collaborate to...
Shiba Inu Breakout Is On The Way! And Only Whales Can Help In That
Shiba Inu is outperforming in the crypto market and gaining the attention of ETH whales Shiba Inu is the most...
Tornado Cash’s Token TORN Plunged Yesterday; Snap Inc Is In The Early Stages Of Planning Layoffs: Tech Market Roundup
Here are some quick tech catch for you so that you stay updated with the latest crypto and tech news...
Adam Mosseri6 days ago
Meta Expands Instagram’s NFT Rollout To 100 Countries — Platform Connects With Third Party Web3 Wallets
adoption6 days ago
Istanbul Blockchain Week founder Erhan Korhaliller discusses why Turkey is one of the hottest places for crypto
Antpool6 days ago
Bitcoin’s Mining Difficulty Rises For The First Time In 57 Days, BTC Hashrate Slipped 1.7% Lower In Q2
bonds5 days ago
Meta Reportedly Issuing $10 Billion In Bonds To Invest In Its Metaverse Products And Other Initiatives
Aladdin6 days ago
Coinbase Partners With World’s Largest Asset Manager Blackrock To Give Aladdin Clients Access To Cryptocurrencies
consumer price index5 days ago
Latest Turkey Inflation Rate Of 79.6% The Highest In 24 Years — Weakening Lira And Russia-Ukraine War Blamed
cbn5 days ago
Nigerian Currency Recovers Versus US Dollar — Central Bank Says Importers Must Repatriate Forex Earnings
Africa6 days ago
Speculators And Crypto Traders Blamed For Naira’s Plunge, Kenyan Institutions Told To End Dealings With Nigerian Fintechs, CAR Token Sale Off To Slow Start