According to data from CryptoQuant’s CEO Ki Young Ju, the average period Bitcoin (BTC) has gone unused has reached a 13-year peak. This increase in dormancy indicates that older Bitcoins are being transferred to new owners, possibly leading to a shift in the cryptocurrency’s ownership structure.
March 23rd marked a new peak for Bitcoin’s Average Dormancy at 227.684, as shown in Ki Young Ju’s chart. Average Dormancy refers to the average length of time since bitcoins last moved or spent. It is determined by dividing the total number of “spent days” (Coin Days Destroyed) by the total amount of coins that have been moved.
Recently, Bitcoin’s Average Dormancy Period reached a 13-year high, suggesting that an appreciable amount of old Bitcoins have been moved to new wallets or holders. In simpler terms, there has been a significant change in the ownership structure of Bitcoin. However, it is yet to be determined who the new significant investors are.
— Ki Young Ju (@ki_young_ju) April 24, 2024
What’s happening?
With a higher than usual Average Dormancy value, it’s likely that long-term Bitcoin holders are becoming active in the market, which might be a warning sign for a potential price decrease. The recent peak in Bitcoin’s Average Dormancy, reaching a 13-year high, is significant for several reasons. Initially, this trend indicates that older Bitcoin investors are either transferring their coins to new owners or choosing to sell them.
A change in this trend could possibly rearrange Bitcoin’s ownership structure, allowing newcomers to claim a larger portion of the market. Additionally, past data shows that heightened Average Dormancy can precede increased Bitcoin price instability. If holders are indeed disposing or moving their Bitcoins, an expanded supply may result, potentially decreasing prices due to increased market availability.
In addition, the increase in Bitcoin’s average dormancy period might indicate shifting attitudes among Bitcoin owners. Long-term investors could be reacting to economic conditions, regulatory updates, or broader market trends that influence their choice to keep or dispose of their cryptocurrency.
In simple terms, Ki Young Ju’s discovery about the changing Bitcoin cap table highlights the dynamic character of the Bitcoin market. As Bitcoins previously held by some individuals are transferred or sold to new owners, the ownership structure of Bitcoin is experiencing a major overhaul. It is essential for investors to keep abreast of these shifts as they may significantly influence market sentiment in the near future.
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2024-04-24 15:31