The unmoved supply of bitcoin continues to grow despite declining prices. This has various implications for the digital asset, with the major one being the volume of available supply in the open market. For most bull rallies in the past, this unmoved supply had remained low, declining at points where investors dumped their bags to avoid the crash. But this illiquid supply is once again on the rise.
60% Of Bitcoin In Unmoved Supply
Bitcoin has maintained its position as the leading crypto investment. This is why owning the cryptocurrency is one of the most coveted positions in the space. However, instead of buying these digital assets and selling them for a profit at a later date, holders of the majority of the supply have opted to hold onto their coins, leading to the large portion of supply being unmoved for a long time.
These bitcoins have not been transferred in at least one year and have remained untouched in that timeframe. On-chain data shows that these investors are picking holding for the long-term rather than short-term gains. As far as investing, these investors have either continued to increase their balances or at the very least, maintained their holdings. This long-term holding sentiment has led to over 60% of all BTC supply remaining in place for the past year.
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For a more accurate figure, Glassnode reports that 60.61% of all bitcoin is yet to be moved in more than a year as of February 18, which was last week. These holdings have remained in place or ‘idle’ in this time frame, showing that the investors do not plan on moving their holdings in the short term. Mostly, larger investors known as whales are behind the majority of the unmoved supply, upping their investments as time goes on.
But Why Is BTC Declining?
Despite more than 60% of supply remaining unmoved, the price of bitcoin has taken hit after hit. Usually, hold sentiment among investors would point towards bullish sentiment and this would trigger an increase in value, but not this time. As sentiment has declined across the space, so has the desire to accumulate coins declined among investors, evident in mostly small-time holders who are said to be behind the recent decline.
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Indicators also show that investors are less likely to purchase the digital asset for prices they have over the past few months. Bitcoin is now trading lower than its average for the past year, and its decline below the 50-day simple moving average (SMA) spells more downtrends in the near future.
Nevertheless, some investors remain undeterred and have taken this as a chance to add to their crypto bags. This accumulation trend is however too weak to have any impact and bitcoin continues to suffer dips as it comes out of the weekend.
Featured image from PCMag, chart from TradingView.com