"crypto winter" as the bear market shows no sign of abating despite its continued persistence. However, on-chain observers are beginning to see what appears to be an imminent light at the end of the tunnel. This is due to the fact that a significant portion of the total BTC supply has not been moved for more than a year.
According to the researchers, we are getting close to bottom.
Late on Friday, two researchers and on-chain experts by the names of Nik Bhatia and Joe Consorti published an article with the title "Ebbing HODL Waves Signal Bitcoin Bottoms." In the essay, coin dormancy on the Bitcoin blockchain was explored, along with its potential implications for the value of the asset.
According to the information presented in the article, a protracted period of BTC inactivity before to a market bottom is an indication of historical data. According to what was stated in the report, "a reliable floor is being set underneath the spot price" as the fluctuation of bitcoin decreases. The analysts also noted the fact that the markets are already laying the groundwork for the subsequent upward trend to begin from this point.
The researchers stated, with reference to a figure provided by Glassnode, that approximately 65 percent of the total BTC supply had not been transacted for more than a year. Based on the analysis of past data displayed on the charts, every time this dormant trend happened, it suggested that the bottom had been reached and that a bull run was about to begin.
This pattern was observed by the community in 2016, which sparked a significant bull run that continued into 2018. Before the trend started to lose steam, BTC soared to an all-time high of more over $19,000. In addition, the metric reached its highest point somewhere in late 2020, and prices were adjusted downward from there. After that, an uptrend developed, which culminated in Bitcoin reaching its all-time high of $68,789 before beginning to retreat.
BiTCoin has taken a lot of damage from bad macro
The Glassnode chart shows that this metric has again reached its highest point and that we may be nearing the bottom. It's important to remember that the recent peak, at 65%, is higher than the peaks in 2016 and late 2020. This backs up the claim that the next bull run could bring the community to a new all-time high.
"If two-thirds of bitcoin is off the market (not for sale) for a very long time, the price goes up when more buyers enter the market and bid for a limited supply," the article said.
Even though these numbers look good, Bitcoin's short-term performance looks at best terrible. Recent changes in the price of BTC have not been helped by the state of the economy as a whole. On August 26, when Fed Chair Jerome Powell spoke, fear caused BTC to drop from its high of $21,700 that day. The value of the asset had been holding steady at the $20k support zone.
