The average Bitcoin (BTC) dormancy has surged to a 13-year high, according to recent data shared by Ki Young Ju, the CEO of CryptoQuant. This uptick in dormancy suggests a significant transfer of older Bitcoins to new holders, potentially reshaping the cryptocurrency’s ownership landscape.
On March 23, Bitcoin’s Average Dormancy reached a level of 227.684, as indicated by a chart shared by Ki Young Ju on X. Average Dormancy is a metric that represents the average number of “destroyed days” of moved coins. This figure is calculated by dividing Coin Days Destroyed (CDD) by the total movement of coins.
What’s happening?
This shift could potentially alter the ownership distribution of Bitcoin, with new participants gaining a larger share of the market. Second, historically, spikes in Average Dormancy have often been followed by increased price volatility. If long-term holders are indeed selling or transferring their coins, it may lead to a greater supply of Bitcoin on the market, potentially putting downward pressure on prices.
Lastly, the rising Average Dormancy could also reflect changing market sentiment among Bitcoin holders. Long-term investors may be responding to macroeconomic factors, regulatory changes or other market dynamics that influence their decision to hold or sell their assets.
Overall, Ki Young Ju’s observation about the shifting cap table for Bitcoin underscores the evolving nature of the market. As older Bitcoins are transferred or sold to new holders, the ownership dynamics of Bitcoin are undergoing a significant transformation. Market participants should closely monitor these developments, as they could have far-reaching implications for market sentiment in the coming months.
This article was originally published on U.Today
https://www.investing.com/news/cryptocurrency-news/bitcoins-average-dormancy-reaches-13year-high-details-3394425
