Recent drop in Bitcoin prices has resulted in record-breaking inflows to so-called accumulation addresses, according to on-chain data.
Bitcoin Accumulation Addresses Have Aggressively Bought The Dip
A crypto analysis expert noted in a recent CryptoQuant Quicktake that the total Bitcoin deposits into savings wallets reached a new record high.
Here, the term “accumulation addresses” refers to digital wallets that exclusively receive cryptocurrency transactions without ever initiating any outgoing transactions. In simpler terms, these are wallets where coins have been bought but not yet sold.
In addition to this description, there aren’t many other rules for an address to qualify as part of this category. A wallet needs to have received a minimum of two transactions (since just one wouldn’t significantly influence the trend), and its total amount should exceed 10 Bitcoins.
Miners and cryptocurrency exchange-connected wallets do not qualify for this group because they naturally act as sellers in the market.
Holders store their cryptocurrency addresses, which are essentially the counterparts to these coins in circulation. By buying and holding onto their coins, they take them out of circulation, reducing the amount available for trading or use.
An address qualifies for this group only if its latest transaction occurred within the past 7 years. Addresses with transactions older than that are typically considered abandoned, as their private keys might be lost or the owners may have simply forgotten about them, making them not active participants in the market.
Here’s a chart illustrating the development over the past year of Bitcoin being transferred to these accumulation addresses, highlighting a notable trend.
The graph above indicates that Bitcoin transfers to long-term storage addresses reached a new peak recently. In just one day, approximately 27,700 BTC (equivalent to around $1.75 billion at the current exchange rate) were moved to these investors’ wallets.
Approximately two months ago, the previous record high for the indicator occurred when investors bought around 25,100 Bitcoins, equivalent to nearly $1.6 billion in value.
The graph indicates that this buying frenzy took place during the market uptrend, ultimately leading BTC to reach new record prices. Consequently, the recent significant purchasing by dedicated investors could be a positive sign for Bitcoin’s value.
This group has made a notable increase in larger purchases more frequently over the past few months, as illustrated by the graph.
The positive market conditions after the green light for spot ETFs and subsequent purchases have contributed to this upward trend.
BTC Price
During the last 24 hours, Bitcoin momentarily dipped under $60,000 before recovering and moving closer to $63,500 once again.
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2024-04-19 10:29