Bitcoin ($BTC) long-term holders, also known as hodlers, have been accumulating the digital asset at a rapid pace, despite its stable price around $27,000. According to data from blockchain analytics firm Glassnode, these investors have been amassing approximately 50,000 BTC monthly for at least 155 days, now owning over 14.859 million Bitcoin or 76% of the total supply. This pattern of accumulation has tightened the market supply, with BTC whales adding approximately $550 million to their holdings since October.
The Bitcoin blockchain is currently experiencing a coin dormancy pattern. Dormant coins suggest a potential market supply shortage and a possible price surge in the event of a supply shock. Seasoned crypto investors are withdrawing an equal amount from exchanges each month, indicating their reluctance to trade under current conditions. This activity has led to the market's liquidity reaching a low point, similar to the bear markets of 2014-15 and 2018-19.
Onchain value transfers and new capital inflows are at multi-year lows, and exchange activity has dropped by 75.5% from its peak of $6 billion in May 2021. The realized volume of Profit and Loss on exchanged coins is also at its lowest since 2020. Glassnode uses the ETH Realized Cap and Stablecoin Total Supply metrics in its capital rotation model to identify periods of altcoin speculation or "altseason mania," simulating a waterfall effect of capital moving from larger to smaller caps.
With just 196 days until the next reward halving event, hodlers continue to amass Bitcoin in anticipation of a bull surge. Arthur Hayes, former BitMEX CEO, predicts that BTC could reach between $750,000 and $1 million by 2026 due to factors like government intervention and inflation. However, Nicholas Merten warns of a significant decline if the U.S. economy enters a recession due to the Federal Reserve’s hawkish stance.
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