Long-term bitcoin holders are continuing to accumulate and are holding for longer, indicating “a broader sentiment of optimism,” according to a recent report.
This week’s Bitfinex Alpha report said 40% of bitcoin’s supply hasn’t moved in more than three years, an all-time high for that metric. Using the Coin Days Destroyed metric, the report found long-standing digital assets have largely remained dormant on-chain.
“This behavior insinuates a broader sentiment of optimism and potential resilience against market volatilities,” Bitfinex analysts said in a note to The Block. The three year metric suggests that a bullish outlook for bitcoin remains intact in the longer term, even though the digital asset is closing August below the $26,000 mark.
A different view
However, the narrower one-year inactive supply metric indicates a more bearish sentiment. “Our analysis indicated that movements on this timeframe preceded the drop in price.” Here, Bitfinex referred to the bitcoin flash crash on August 17 that saw over $1 billion in liquidations and caused BTC to dip into $25,000 territory. “These ‘newer’ long-term holders who acquired their spot positions over the bear market are now unsettled, but not in a state of panic,” the analysts added.
The world’s largest digital asset by market capitalization is currently changing hands for $25,943 at 7:00 a.m. ET, according to CoinGecko. Recent hawkish tones from the Federal Reserve, rising bond yields, and uncertainty in China are encouraging risk-off sentiment.
