Long-term holders of Bitcoin are using the token’s latest price crash to build their holdings.
Bitcoin has slumped nearly 36% this year and is currently trading around $29,000- its lowest level since late-2020. The token has now effectively lost all of its gains through 2021- one of its best years ever.
But long-term Bitcoin holders appear to be undeterred by the recent losses. Data shows that they have used the crash as an opportunity to accumulate.
Long-term Bitcoin holders are accumulating
Data from blockchain analytics firm IntoTheBlock shows that long-term holders are using this bear market to increase their tokens. The trend is observed during most bear markets, given that the fall in prices makes Bitcoin far more attractive.
Source: IntoTheBlock
The percentage of $BTC owned by addresses holding one year or longer (green to blue colors) has expanded in previous bear markets – So far we’re repeating this same pattern
But this accumulation has still been unable to surpass the selling pressure experienced by Bitcoin. Amid broader dumping by institutions and short-term holders to mitigate losses, the token has marked a sharp decline this year.
Sentiment towards the crypto market has also sunk to near record lows. The crypto fear and greed index has hovered around “extreme fear” for nearly all of May.
Trading volumes skyrocket
Bitcoin’s selling has also been highlighted by a near record amount of trading volumes. Data from blockchain analytics firm Santiment shows that Bitcoin saw its second-largest total volumes since hitting an all-time-high in November 2021.
The reading highlights the massive rate at which large holders, specifically institutions, have dumped their Bitcoin holdings.
Market analysts have also expressed caution over trying to time a Bitcoin bottom. BitMex co-founder Arthur Hayes recently wrote that the token could bottom out as low as $25,000– a level it has already flirted with this year.
Hayes also noted that the token is far from ready to stage a recovery, and will only do so when its short-term holders have been liquidated.
The post Here’s How Long-Term Bitcoin Holders Are Responding To The Crash appeared first on cryptotimes24.com.
