Renewed Interest in Accumulating and Holding Bitcoin Among Investors
Bitcoin investors are displaying a renewed interest in holding and accumulating the cryptocurrency, as per the latest on-chain report from Glassnode. Following a phase of supply distribution post Bitcoin’s all-time high in March, the market is now indicating early signs of a shift towards accumulation.
The trend towards accumulation is being led by large wallets, often linked to exchange-traded funds (ETFs). The Accumulation Trend Score (ATS), a metric evaluating weighted balance changes across the market, has reached its maximum value of 1.0, indicating significant accumulation over the past month.
Additionally, Long-Term holders (LTH) have altered their behavior. After reducing holdings during the run-up to the all-time high, this group has now reverted to a preference for holding. Over the last three months, a total of 374,000 BTC has transitioned into LTH status.
The 7-day change in LTH supply, a tool used to gauge changes in their aggregate balance, has returned to positive territory, indicating that LTH investors are inclined towards retaining their coins. Despite significant distribution from April to July, the spot price has remained above the Active Investor Cost Basis of $51,300, showcasing the resilience of the market.
Glassnode pointed out that the market finding support near this level indicates underlying strength and suggests that investors are generally anticipating positive market momentum in the short-to-medium term.
The shift towards accumulation comes amidst market uncertainty following a recent sell-off. However, data indicates that investors’ inclination to hold onto their assets is now a more dominant force compared to their spending pressures.
The week commenced with inflows into spot Bitcoin ETFs after ending the previous week with nearly $90 million less in assets under management (AUM), according to data from Farside Investors. ARK 21Shares’ ARKB recorded the highest inflows on Aug. 12, surpassing $35 million, with IBIT adding $13.4 million, while Grayscale’s GBTC saw a reduction of nearly $12 million in AUM. Conversely, Grayscale’s “mini trust” with the BTC ticker attracted $7.9 million in cash.
In conclusion, the cryptocurrency market is witnessing a shift towards accumulation, with investors showing a preference for holding onto their Bitcoin amidst ongoing market fluctuations. This trend highlights a growing confidence in the long-term potential of the digital asset.
