Long-term Bitcoin (BTC) investors are seen accumulating coins during this period of time when the price of the largest cryptocurrency has been falling.
Specifically, Glassnode’s index, which observes the 30-day change in holdings of long-term holders (i.e. those who have held their coins for more than six months), turned positive in early April and has since shown an increase for four weeks in a row.
The screenshot shows that net accumulation is currently following the fastest pace since October 2021. This indicates that investors see the recent weakness in the Bitcoin price as a buying opportunity in view of the upcoming market rally.
“Long-term BTC holders are adding to their positions, indicating that investors see the recent pause in the upward price movement as an opportunity to acquire even more coins,” noted Q9 Capital, a cryptocurrency investment platform.
Glassnode defines long-term holders as wallets that hold their coins for at least 155 days without selling or moving them.
The concern for traders
Bitcoin topped $31,000 on April 14, marking its highest level since June 2022. However, since then, the price of the cryptocurrency has fallen 12% to $27,500, while the Nasdaq has risen more than 2% since mid-April.
The Nasdaq-to-S&P 500 ratio, which Bitcoin has followed closely in the past, has also increased by over 2% during this time period. This divergence is a concern for Bitcoin bulls, according to Matrixport’s head of research and strategy, Markus Thielen:
“Based on the relationship with tech stocks (Nasdaq), Bitcoin should now be above $30,000 and the fact that this is not the case should alert short-term traders,” Thielen said in a note to his firm’s clients, adding: “This disconnect may start a more significant divergence between the two.”
Subsequently, Thielen stated:
“Many equity investors were expecting a recession to come in the US, yet they saw tech stocks rise. These shorts should be covered. Unfortunately, Bitcoin does not have large outstanding shorts that could be squeezed, which is possibly why we are seeing this divergence between Nasdaq and Bitcoin.”
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