Market Analysis
Bitcoin started the week off with an abrupt bullish breakout to $37,500, a level some analysts have identified as a crucial line in the sand , but the rally was short-lived as BTC met selling near the lower arm of the bearish pennant that can be seen on multiple timeframes.
While many traders are concerned that the 2021 bull market is now over and considering whether gains should be locked in, on-chain data shows that long-term Bitcoin (BTC) holders have been accumulating in preparation for a potential 2013-style double-pump that has the potential to elevate BTC to a fresh all-time high.
News
On-chain analytics provider, Glassnode, has published data revealing that Bitcoin miners are accumulating while long-term investors are taking profits.
Despite January seeing heavy selling from miners, Glassnode’s report shows that miner outflows have dried up during February so far.
Chart - Glassnode.com
The report asserts that miners and longer-term investors are the two principal sellers of Bitcoin during bull markets. According to Glassnode, declining miner outflows can be inferred as bullish, with miners either having already covered their costs of operation or stockpiling coins in response to Tesla’s $1.5 billion Bitcoin investment:
“This suggests that miners have either completed adequate sales to cover costs, or could also mean they see Tesla s vote of confidence as fair reason to keep a strong grip on their treasuries.”
Bitcoin on Exchanges Drop to Lows Not Seen Since 2018, Long-Term Holders Realize Profits
According to data, bitcoin balances on exchanges are shrinking a great deal and have dropped to levels not seen in two years. Arcane Research detailed that charts showing the number of bitcoin leaving exchanges has seen a sharp decline and has been “one of the main stories of the year.” Meanwhile, onchain metrics indicate a number of older coins are being sold as bitcoin’s value increases.
Bitcoin Held on Exchanges Drops by 21% Since February
In 2020 there’s a lot of cryptocurrencies held on exchanges, however, the aggregate number of bitcoin (BTC) held on trading platforms has declined immensely this year. In fact, BTC held on exchanges haven’t been as low as they are today since 2018, according to onchain statistics by Glassnode.