- Bitcoin’s price fell as the accumulation rate slowed across all cohorts.
- Addresses were largely unprofitable and had little incentive to sell their assets.
Bitcoin [BTC] fell towards $61,000 at the time of writing, causing a wave of skepticism among holders and traders alike.
Accumulation on hold
One of the reasons for this would be the declining accumulation of BTC seen across the board. This trend started in May, coinciding with a local price bottom for Bitcoin.
Over the past 30 days, all cohorts combined have added approximately 10,000 Bitcoin to their holdings. This paled in comparison to the 19,000 new Bitcoins created during the same period.
It was the smaller investors, often called shrimp, who led the accumulation effort.
Source:
The decline in BTC accumulation could lead to price declines at worst and price stagnation at best.
If addresses continue to HODL their BTC despite market fluctuations, the price of BTC could remain the same and may not appear in the red in the near future.
What will holders do?
One of the things that would dictate the behavior of these holders would be their profitability. AMBCrypto’s analysis of Santiment’s data showed that the MVRV ratio for BTC had remained in the red.
This indicated that most BTC addresses were holding their coins at a loss. Most addresses would be willing to wait for their BTC to become profitable before selling their holdings.
Another key factor that will play a role in determining the behavior of holders is the Long/Short ratio. Over the past month, the Long/Short ratio for BTC had dropped significantly.
A decreasing Long/Short ratio indicated that at the time of writing, the number of short-term holders was slowly exceeding the number of long-term holders.
Read Bitcoin’s [BTC] Price forecast 2024-25
These short-term holders are much more likely to panic sell their holdings during times of market uncertainty, which could contribute to the selling pressure BTC is facing.
Source: Santiment
At the time of writing, BTC was trading at $61,533.04 and the price had fallen 1.50% over the past 24 hours. Moreover, trading volume was down 1.77%.