Positive Vibes: 18,000 Bitcoin Purchased By Diamond Hands In One Week

Positive Vibes: 18,000 Bitcoin Purchased By Diamond Hands In One Week

Bitcoin has been moving sideways the past week after experiencing rejection at the $25,000 region. The cryptocurrency has been reacting to macroeconomic uncertainty pushing its price to the downside, but BTC continues to flash long-term buying signals.

As of this writing, BTC trades at $23,500 with 1% profits in the last 24 hours. Over the previous week, Bitcoin records a 5% loss. Other cryptocurrencies in the crypto top 10 by market cap are recording similar price action, with Cardano (ADA) and Polygon (MATIC) leading the losers with a 10% and 16% loss, respectively.

Bitcoin BTC BTCUSDT

Lon Term Bitcoin Holders Display Relentless Accumulation

According to a report from Bitfinex Alpha, the recent downside price action in Bitcoin has led to a spike in accumulation from long-term holders. These investors took advantage of the decrease in the BTC price to accumulate massive amounts of the cryptocurrency.

The report claims that long-term Bitcoin holders bought over 18,000 BTC in the past week. Bitfinex Alpha claims that these market dynamics suggest the crypto market is showing characteristics of an end of its bear cycle.

Whenever long-term BTC holders come into the picture and accumulate, the price of Bitcoin trends to the upside. The chart below shows that the 2021 bull run was preceded by a spike in the long-term holder supply, the amount of Bitcoin in the hands of multi-year investors.

Bitcoin BTC BTCUSDT Chart 2

Unlike speculators, these investors hold the cryptocurrency for higher timeframes, reducing the amount of BTC available to sell. Thus, Bitcoin moves in tandem with this metric. The report claims:

The Long-Term Holder Supply has continued to push higher. Long-term hodlers constituting a sizable portion of the BTC supply is a crucial on-chain feature of bear market bottoms, and is a positive signal, taking place amid a 40 percent increase in price, since the start of this year.

In addition to the increase in long-term BTC holders, the report noted whale wallet inflows since last Friday, February 25. These inflows hint at confidence from large investors in the BTC price. The report concluded:

Historically, whales have continued to accumulate through even 100 percent moves (for example when the price rose from $3k-6k in 2019) during the end of the bear market; such was the case during the 2019 bear market rally and the 2020 flash crash when the pandemic sent risk assets crashing.

editorial staff