Blockchain data provider Glassnode says a significant number of Bitcoin has not moved in over a year, showing an increase of hodling behavior among investors.
A tweet from the on-chain analysis firm reveals that 60% of the BTC supply has remained inactive in the last 12 months. Glassnode notes that the last time the percentage of dormant BTC hovered around 60% was nearly three years ago, months before the leading cryptocurrency exploded to its all-time high of $20,000.
60% of the #Bitcoin supply hasn't moved in over a year, showing increased investor hodling behaviour.
Last time we saw these levels was right before the $BTC bull market of 2017. pic.twitter.com/mRXQmhUzGu
— glassnode (@glassnode) May 29, 2020
The increase in hodling behavior comes even after the pandemic-induced crash in March which saw Bitcoin lose over 50% of its value within 48 hours. Days after the collapse, Glassnode said that cryptocurrency users withdrew their BTC from exchanges at a rapid rate and moved it to private wallets, which is another indication that investors are holding onto the asset.
“Despite the volatility, Bitcoin holders appear to be withdrawing their funds from exchanges. Outflow has been increasing daily since March 18. According to our labels, BTC exchange balances are the lowest they’ve been in ~8 months.”
Analysts are quick to point out that the supply tends to move after price surges. The increase in activity during a bull rally suggests that hodlers or investors are possibly transferring their BTC to exchanges so they can sell. Based on Glassnode’s chart, more trading occurs as the value of the cryptocurrency rises, lowering the percentage of inactive BTC.
At time of writing, Bitcoin is closing in on $10,000 resistance and trading at $9,546 after peaking at $9,696 over the weekend, according to data compiled by CoinMarketCap.
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