Coin Metrics: Bitcoin crash provoked …
Coin Metrics: Short-term holders of the cryptocurrency provoke the collapse of bitcoin
The recent fall in the price of bitcoin was mainly driven by short-term and relatively new holders of the cryptocurrency. This is the conclusion reached by Coin Metrics employees based on data from the blockchain.
On March 11, about 281,000 BTC were moved without moving for at least 30 days. At the same time, only 4,131 BTC did not move for over a year. In other words, most of the market activity on March 11 and 12 came from coins that had been stored for less than a year..
On March 11, there was the fourth largest jump in the movement of bitcoins held in storage for 30 days in the last 8 years.
Long-term storage of bitcoins on this day did not show increased activity.
Analysts note that it is only the fourth time that Bitcoin’s market value relative to its realized value (MVRV) has fallen below 1.0. A value of 1.0 or more indicates that speculators, on average, value cryptocurrency higher than holders. If it falls below one, the likelihood that long-term holders will be able to make a profit if they immediately sell the cryptocurrency also decreases.
MVRV was down half a point on March 12. This is the largest drop in a single day since December 2013. In the past, MVRV at comparable levels allowed investors to accumulate cryptocurrency quite successfully..
Coin Metrics also noticed that along with the fall in the value of the largest cryptocurrencies, the capitalization of stablecoins grew. USDT on the Ethereum blockchain from March 10 to 15 added $ 300 million, USD Coin (USDC) – $ 150 million. The observed dynamics may indicate that in the light of recent movements, investors prefer to sit in the equivalent of fiat currencies on the blockchain.
“The initial data, already available after a crazy week, are encouraging in a way. Most of the selling appears to have been driven by relatively short-term holders, while long-term holders are showing resilience, at least for now. BTC entered a historically attractive price zone with MVRV below one. However, the markets are still volatile and the future prospects are vague, ”the company writes..
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