Small Entities and Long-Term Holders Accelerate Bitcoin Accumulation Amid Limited Supply
Summary:
According to data from Glassnode, Bitcoin's (BTC) readily accessible supply is at a record low, signalling an ongoing accumulation trend among investors, especially small entities and long-term holders. This development is contributing to Bitcoin’s price support above $34,000. Year-to-date figures show that almost every investor group is increasing their Bitcoin holdings. However, every trade and investment carries inherent risks, suggesting the need for personal research and informed decisions.
Recent data from Glassnode suggests that Bitcoin's (BTC) supply that's readily available has reached a record low, indicating an ongoing accumulation trend. This data points to an increase in both Bitcoin’s locked-up supply and the number of long-term holders. As supply decreases, small entities with long-term investment plans are increasingly snapping up BTC.
Glassnode analysis reveals that investors, confident in the cryptocurrency's potential, are consuming about 92% of the newly mined Bitcoin. Notably, the so-called 'Shrimps' (who own less than 1 BTC), 'Crabs' (owning 1-10 BTC), and 'Fish' (holding 10-100 BTC) represent a significant accumulation trend. This group alone has absorbed 92% of the freshly minted BTC since May 2022.
The trend of small-time investors acquiring newly minted Bitcoin is resulting in a record number of "HODLers" over short-term speculators, a pattern unseen since July 2023. Moreover, short-term holder supply has fallen to an all-time low, while the proportion of long-term holders remains solid. This dynamic is likely contributing to Bitcoin’s buoyancy above the $34,000 mark and offering staunch support over the $30,000 level.
In conversation with Cointelegraph, Joel Kruger, a market strategist at LMAX Group, offered insights into a potential Bitcoin surge towards $40,000, attributing it to ongoing demands from mid and long-term investors. Bitcoin's resilience, despite fluctuations in currencies and risk assets, may spark the next surge of bullish momentum upon breaching the $36,000 resistance point.
In addition, Bitcoin’s limited supply and the rise of coins classified as 'illiquid' generally signal a bullish trajectory. Besides, the illiquid Bitcoin supply is currently on track for consistent monthly inflows for yet another year. Around 71,000 BTC become illiquid per month.
The dwindling supply of Bitcoin has piqued interest across all types of investors, not just smaller entities. The year-to-date figures show an uptick in BTC holdings across nearly every investor sector, a trend that the following chart clearly illustrates.
Please note that this article does not offer investment advice or recommendations. Every trade and investment strategy carries inherent risks and should thus be based on personal research and informed decisions.
Published At
11/7/2023 8:07:13 PM
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