Markets
Insights into long-term stability and holding
The price of Bitcoin (BTC) has consistently remained between $67,000 and $68,000 for several days. In this analysis, BeInCrypto aims to understand Bitcoin’s price action.
Furthermore, we observed a decline volatility, which can be attributed to various factors. To provide a complete analysis, we will explore who buys and sells Bitcoin.
Examining Bitcoin Activity and Deposit Rates
The chart below illustrates Bitcoin’s activity rate and deposit rate over time, along with its price in USD. Here are the main observations from the graph:
Activity rate (shown in red):
The activity rate shows how much Bitcoin is actively traded or moved by userswhich indicates how often people use or transfer their BTC.
Notable spikes and dips indicate periods of increased and decreased activity among Bitcoin holders. Significant fluctuations can be observed, particularly around key price movements. We observed an interesting decline in the activity rate, from 9% to -3%. This decrease in activity could indicate a trend towards long-term holding of Bitcoin.
Twirl rate (shown in green):
The vault rate shows how many Bitcoin users are moving storage over the long term, keeping it safe for the future (the supply in the vault represents the percentage of Bitcoin that has been secured or never sold since its first acquisition).
Positive deposit rates suggest that investors are moving more BTC into long-term storage. The chart shows periods when the deposit rate increases, potentially indicating holders’ confidence in the asset’s future value.
To know more: Who owns the most Bitcoin in 2024?
Bitcoin: vaulting and activity rates. Source: Glassnode
The decline in activity and the increase in deposits could explain the decreasing trend in volatility.
Understand UTXO value distribution tracking
The UTXO (Unspent Transaction Output) Value Distribution Monitor analyzes BTC transactions based on the value of BTC held in different wallets. Let’s break it down in simple terms and explain what this indicator tells us.
What is UTXO?
UTXO stands for Unspent transaction output. It refers to the amount of Bitcoin received after a transaction that can be used in future transactions. In essence, UTXOs define where each blockchain transaction begins and ends.
What does UTXO value distribution monitoring show?
The colored bars represent the daily changes in the amount of BTC held in different UTXO value ranges:
- Red bars: Changes in UTXOs holding more than 10,000 BTC.
- Purple bars: Changes in UTXOs holding between 1,000 and 10,000 BTC.
What does this indicator tell us?
UTXO’s Value Distribution Monitor helps us understand the behavior of BTC holders, from small investors to large whales (very large holders). Here’s what he can tell us:
Accumulation and distribution:
Positive changes mean more BTC remains in that value band. For example, if the red bars (10,000+ BTC) are positive, large holders accumulate more BTC.
Negative changes indicate that BTC leaves that value range. So, if the blue bars (1,000 – 10,000 BTC) are negative, mid-range holders sell their BTC.
Market sentiment:
If large holders accumulate (over 10,000 BTC), this suggests they have long-term confidence in the value of Bitcoin.
If mid-range holders (1,000 – 10,000 BTC) sell, they could take profits or reallocate their assets.
Market dynamics:
The interaction between different value bands can indicate broader market trends. For example, if we see 1,000 – 10,000 BTC holders selling and over 10,000 BTC holders buying, this suggests that the market the big players are confident in the future of Bitcoin at current prices, although smaller operators are less certain.
To know more: Bitcoin (BTC) Price Prediction 2024/2025/2030
In summary, Bitcoin’s price stability in the $67,000 to $68,000 range, combined with declining volatility, suggests a maturing market. The decline in the activity rate and the increase in the vaulting rate indicate a move towards long-term detentionreflecting greater confidence among key holders.
UTXO’s Value Distribution Monitor further supports this finding, showing that large holders are accumulating BTC while mid-range holders are selling. These trends point to a market where large players are optimistic about Bitcoin’s future, reinforcing its potential as a long-term investment.
Disclaimer
In line with the Trust Project guidelines, this article on price analysis is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and impartial reporting, but market conditions are subject to change without notice. Always conduct your research and consult a professional before making any financial decisions. Please note that our Terms and conditions, Privacy PolicyAND Disclaimer They have been updated.