Analysis: Dormant Bitcoins on the Move, Downward Pressure Brewing?
CryptoNewsTerminal Staff13 Aug, 2024
Analysis: Dormant Bitcoins on the Move, Downward Pressure Brewing?
Bitcoin's price action has been under downward pressure recently, and one analyst believes that the movement of long-term dormant BTC is a contributing factor. CryptoQuant contributor XBT Manager diagnosed that "BTCs that have been inactive for a long time are putting downward pressure on the market as they move on-chain." He explained that "on the 11th, 18,536 BTCs that had been inactive for 2-3 years moved. A few hours later, 5,684 BTCs inactive for 3-6 months, 2,588 BTCs inactive for 6-12 months, and 2,394 BTCs inactive for 3-5 years moved on-chain. When bitcoins that have been dormant for a long time move like this, it often puts selling pressure on the market. The impact on the price is greater, especially when the liquidity is low.” This analysis suggests that investors who have been holding Bitcoin for a long time are starting to sell their holdings, which is putting downward pressure on the price. This could be a sign that the market is topping out, or it could simply be a temporary correction. Only time will tell what the future holds for Bitcoin, but investors should be aware of the potential risks involved.
