How confidence in Bitcoin’s long-term potential touched new heights
Altcoins have been outperforming BTC, suggesting that market players may be overlooking the king coin. But for Bitcoin illiquid cohort, the rotation is no reason to change their stance.
- Bitcoin’s illiquid supply reached a new ATH, indicating confidence in the long-term potential.
- BTC accumulation and circulation continue to increase.
Jumping from a little below $16,000 to over $37,000 is usually enough reason for Bitcoin [BTC] investors to take profits. But for the coin holders with a minimal history of selling, now is not the time.
In fact, based on the sentiment shown by this cohort, the price rise before the Bitcoin halving could be the best season to keep BTC off exchanges.
Unbothered by the hype
To arrive at this conclusion, Glassnode, considered Bitcoin’s illiquid supply. The analytics handle noted that the metric had reached its All-Time High (ATH).
The #Bitcoin Illiquid Supply metric, which measures the amount of supply held in wallets with minimal history of spending is at an ATH of 15.4M BTC.
Changes in Illiquid Supply often move in tandem with exchange withdrawals, suggesting investors continue to withdraw their coins… pic.twitter.com/lwHQmFkoMy
— glassnode (@glassnode) November 10, 2023
An entity is considered illiquid when it refuses to turn its assets into cash. This sort of action is considered bullish. Hence, the illiquid supply hitting an ATH indicates a surge in the conviction of Bitcoin’s positive long-term potential.
The decision to keep holding onto Bitcoin might also be found in the Accumulation Trend Score.
Whenever AMBCrypto analyzes the accumulation trend score, we find out if entities are accumulating BTC on-chain. It also tells if market participants are selling.
Values close to zero of the metric mean sell-offs are much more than acquisitions.
In this instance, the price action could be affected negatively. On the contrary, values close to 1 indicate a surge in accumulation. Unlike the distribution period, accumulation precedes an increasing Bitcoin price.
At press time, the Bitcoin Accumulation Trend Score had risen to 0.98. This reading, as explained above, is a sign that BTC’s value could increase again in the short term.
The funds are finding a new home
Lately, altcoins have been outperforming BTC, suggesting that market players may be overlooking the king coin. From the Bitcoin dominance chart, it seemed to be the case as the value had fallen from a height of 52.78% to 52.59%.
This decrease implies that liquidity initially assigned to BTC is being rotated to other cryptocurrencies. Another metric backing this conclusion up is the Weighted Sentiment.
The Weighted Sentiment considers the positive/negative commentary linked to an asset around social media platforms.
Previously, specifically on 9th November, Bitcoin’s Weighted Sentiment was 1.006. But as of this writing, the metric had flatlined at 0.002. This drop indicates that the average market participants were indifferent about the BTC price action.
Also, this could remain the case as long as other altcoins keep up their recent performance. Additionally, the last seven days have brought about a rise in BTC circulation. According to data evaluated by Santiment, the circulation has risen to 441,00.
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This rise indicates an increase in the usage of the king coin and transfer from one address to another. Also, the surge in the metric means there is more demand for BTC.
However, the demand needs to continue to match or outpace the supply for the price to stay above $37,000.
