Although the US dollar is on the rebound, the price of Bitcoin continues to increase, reaching $51,353.76 at the time of writing. The price ranged from $46,465 to $51,851 during the week, reaching a new high, FX Empire wrote on September 6.
Despite strong US dollar gains at the London trading session, it’s still not clear when the US central bank will start tapering assets. In general, on-chain sentiment remains positive, leading experts to predict further gains in September. Spot exchange reverses continue to demonstrate a multi-year low.
Decreasing transaction numbers drive coin accumulation
Decreasing transaction numbers and a very limited outflow of Bitcoins to crypto exchanges keep driving accumulation among miners. Older coins that marked a profit during similar bullish spells are also accumulating. Some of these coins dropped from $10,000 to $3,800 as Bitcoin dropped down to that amount during the March 2020 global liquidity crisis. It might have come to panic selling if another market cataclysm had occurred at that time.
One year to one and a half year coins aged and kept accumulating as Bitcoin passed $30,000, then consolidated above $40,000, ultimately pushing to its present price of above $50,000 after plummeting to $30,000 in May 2021.
People are most likely to spend Bitcoins mined less than three months ago
Glassnode data shows that people are most likely to spend Bitcoins mined less than three months ago during periods of volatility. However, it seems the market would rather hoard than spend, evidenced by a decline in HODL waves for young coins. Since young coins make up just 15% of total supply, this indicates a very pronounced downtrend.
Proportion of older coins is increasing; shows higher illiquid supply
In several months, young coins will become middle-aged ones (aged 3 to 12 months) and to old ones (one year old or more). The proportion of older coins is increasing, which indicates rising illiquid supply. The reason is that statistically, people are less likely to spend such coins.
Crypto market undergoing a pronounced maturation trend
Investors who are willing to sell are on the supply side, while demand and supply are seen from the viewpoint of one who doesn’t intend to sell. With almost 50% of coins in circulation aged between three months and three years, the crypto market is undergoing a pronounced maturation trend. The total crypto market cap has increased by more than a trillion in less than two months.
