Key Takeaways
- Long-term holders continue to sit on their Bitcoin stashes
- Two-thirds of the supply has not changed hands in the last year, despite rampant volatility and a collapse of the Bitcoin price
- Over half the supply has not moved in 2 years or longer
“Supply squeeze” is a seductive phrase thrown around among Bitcoin enthusiasts.&
It refers to the predicted propelling upwards of the Bitcoin supply as a result of the supply cap &- there will only ever be 21 million bitcoins &- and a constant increase in demand.&
Whether this comes to fruition remains to be seen. But there does appear to be a growing cohort of Bitcoin investors who are holding. In fact, over two-thirds of the entire supply has not moved in over a year, an all-time high.&
To be precise, 67.9% of the Bitcoin supply has not moved in over a year. That is extremely high, especially when considering the last year have brought its fair share of scandals, including the respective crashes triggered by LUNA, Celsius and FTX.&
Combining these scandals with the most rapid monetary tightening in the wider economy, which have seen interest rates rise from near-zero to close to 5%, and the crypto market has been pillaged.&
Looking at the price action over the last 12 months, Bitcoin has fallen from $41,000 to $15,000 and is now trading at $28,000, with more than its fair share of ups and downs in between. And yet, two-thirds of the supply has been stagnant.&
Branching further out, over half the supply has now not moved in two years, close to 40% hasn’t moved in three years, while 28% has been stationary for 5 years.&
Of course, lost coins will be included in all these statistics. Bitcoin has been around since 2009, and that means people have died, and with them access to their coins has vanished.&
There are also simple cases of lost keys, people still roaming the Earth but with no access to their wallets. Let us not forget that Bitcoin was just a niche Internet plaything not so long ago, trading for less than $1 per coin.&
Not to mention, Satoshi Nakamoto’s mammoth stash of an estimated 1 million coins, or over 5% of the entire supply, remains untouched and included in the above stats.&
So make of it what you will, but Bitcoin still remains quite an illiquid market and with a dwindling supply, it is easy to see the narrative pushed by enthusiasts that if demand continues to rise, the price will only go upward.&
Of course, whether that demand will indeed continue to rise is another question entirely, and a much harder one to answer.&
The post Over two-thirds of the Bitcoin supply has not moved in a year appeared first on CoinJournal.
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