Only 27% of Circulating Bitcoin has Moved in 2020; Why This Matters

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javfischer
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Bitcoin’s ongoing bout of sideways trading has offered little insight into its mid-term outlook. New data now shows that Bitcoin’s price action throughout 2020 has been driven by a significantly limited number of market participants, which may explain why the crypto has been ranging between $9,000 and $10,000 for over six weeks. According to one analytics firm, only 27% of BTC’s circulating supply has moved in 2020. This means that the remaining 73% has remained dormant, with active traders utilizing margin, futures, and options likely being the source of all of its volatility. This comes as data shows that the benchmark cryptocurrency’s fundamental health is starting to grow, potentially opening the gates for it to see further upside in the weeks and months ahead. Bitcoin’s multi-week bout of consolidation has struck a blow to investor sentiment, leading many to forecast that the cryptocurrency will soon breakdown and start a new downtrend. There are factors that support this notion, including the triple top at $10,500 that is currently in play, the consecutive rejections it has posted at $10,000, and the lower highs it has been establishing. There is one indicator that shows Bitcoin has been incurring growing fundamental health throughout this consolidation period, suggesting that its next movement could favor buyers. Glassnode’s Compass – an indicator made by the research firm – shows that the crypto has been slowly transitioning into bull territory over the past several months. They further go on to explain that Bitcoin’s stable position within the green zone is a good sign for its mid-term outlook. According to other data from Glassnode, only 27% of Bitcoin’s circulating supply has been moved in 2020. The rest has remained dormant. This means that the market is currently being driven by a small percentage of market participants, as likely only a fraction of this 27% is being moved as a result of active trading. Rafael Schiltze-Kraft – the CTO of Glassnode – spoke about this in a recent tweet, saying:


All data is taken from the source: https://www.newsbtc.com/
Article Link: https://www.newsbtc.com/2020/07/01/27-of-circulating-bitcoin-moved-in-2020/


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Crypto Trading
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