According to a recent analysis by Glassnode of Bitcoin’s highly liquid supply, the current figure is hovering near the cycle low of 2.94 million BTC, exhibiting a decrease of 620,000 BTC since January 2022. This trend suggests that the actively tradeable supply contracts reduce liquidity and a constrained supply side.
Glassnode, an outstanding analytical platform, revealed a significant decline in Bitcoin’s Highly Liquid Supply, affecting tradeable supply & market liquidity. Check out their detailed analysis here:
The #Bitcoin Highly Liquid Supply has recorded a stark decline across our cycle, currently residing near a cycle low of 2.94M BTC, a -620K BTC decrease since Jan 2022.
— glassnode (@glassnode) June 19, 2023
This suggests a significant contraction in the actively tradeable supply, resulting in both a decline in… pic.twitter.com/H9PJV3fWC8
Data from CryptoQuant highlighted an intriguing secret signal behind Bitcoin’s rise. The platform pointed out that the long-term holders (LTH) appear to be holding onto their assets, indicating growing confidence in the market’s prospects. This shift in behavior among LTHs has the potential to influence the cryptocurrency’s price trajectory positively.
According to the insights shared by another prominent analytics platform CryptoQuant, the secret signal behind Bitcoin’s rise is the Long-term holders’ (LTH) reduced selling activity, which indicates a surge in market confidence. Discover more in their insightful tweet:
The Secret Signal of Bitcoin's Rise: Why are LTH Holding Their Assets?
— CryptoQuant.com (@cryptoquant_com) June 19, 2023
"A decrease in selling activity by LTH typically indicates growing confidence in the future of the market…"
by @AxelAdlerJr
Link👇https://t.co/4FG7ZjDN9A
The decreased selling activity among LTHs demonstrates their belief in Bitcoin’s long-term value. As these investors hold onto their assets, the available supply for trading diminishes, creating an environment where demand outstrips supply. This scarcity could drive up the price of Bitcoin, further solidifying its status as a valuable digital asset.
Moreover, this trend could also signify a maturing market, as investors increasingly view Bitcoin as a long-term investment rather than a short-term speculative play. This shift in perception might attract more institutional investors, who typically prioritize stability and long-term growth over short-term gains.
While the decline in Bitcoin’s highly liquid supply might initially raise concerns about the cryptocurrency’s liquidity, it’s important to consider the broader context. A constrained supply side could lead to increased demand and higher prices in the long run, benefiting those who view Bitcoin as a long-term investment.
In conclusion, the decreasing highly liquid supply of Bitcoin long-term and term holders’ reluctance to sell indicates growing confidence in the digital currency’s future. This trend could result in a more stable and mature market, attracting further investment and driving up the price of Bitcoin. As the cryptocurrency ecosystem continues to evolve, it would be crucial for investors to monitor these signals and adjust their strategies accordingly.
