Glassnode, a popular blockchain data and research platform, has published a new analysis on the supply dynamics of Bitcoin (BTC) on Twitter. According to Glassnode, the values of Bitcoin supply across all age groups are increasing, which means more coins are maturing and becoming inactive.
This indicates that HODLing, or long-term holding of Bitcoin, continues to be a dominant behavior among long-term investors. Glassnode argues that this means more volatility in price movements is needed to entice older investors to use their coins.
Assessing the #Bitcoin: Supply Last Active Age Bands, we note that the values across all age cohorts are increasing as large swathes of coins continue to mature. This suggests that HODLing remains the primary dynamic amongst longer-term investors, insinuating that further volatility in price action is required to entice old hands to spend.
This analysis is based on the Last Active Age Bands of Supply metric, which shows the distribution of Bitcoin supply by time since its last movement on the blockchain. In this metric, its supply is divided into five age groups: young (less than 1 day), juvenile (1 day to 1 week), adolescent (1 week to 3 months), mature (3 months to 2 years), and older (more than 2 years). ).
This metric can be used to gauge the sentiment and confidence of different types of investors, as well as identify potential supply shocks or sell-offs. For example, a drop in older coins may indicate that long-term coin holders are starting to take profits or losing faith in Bitcoin, while an increase in younger coins may indicate more trading activity or speculation.