Despite an uncertain global economy, geopolitical issues and extreme market volatility, large Bitcoin holders are still not ready to spend their digital assets. Glassnode’s weekly on-chain analysis report indicates that the illiquid Bitcoin supply, a metric that shows the volume of coins held in wallets with little or no history of spending, has increased to its highest level in nearly 10 months.
Almost 76.3% of the circulating BTC supply is illiquid, compared to 76% in May 2021. Long-term holders of Bitcoin have kept accumulating the crypto asset steadily over the past few months. Last month, top BTC addresses holding above 100,000 coins increased their accumulation. As a result, their cumulative holdings have crossed 664,000 BTC.
“As a proportion of circulating supply, Illiquid Supply has now surpassed the May 2021 peak, reaching 76.3%. This has now returned to the same level as the 2017 market top, reversing a four-year-long increase in coin wallet liquidity. Note, however, that both of these instances preceded major sell-off events, thus it remains to be seen if these coins are truly in cold storage,” Glassnode outlined.
BTC’s Price Recovery
Bitcoin’s recent price recovery had a positive impact on its overall network activity. Glassnode highlighted that the latest surge in BTC’s price has caused a sharp increase in its profitable supply. According to the data provider, BTC's supply in profit has jumped from 65% to 75% as a result of its recent price boom.
BTC exchange supply, which indicates the on-chain flow trend of Bitcoin, has been in a downtrend for the past 3 months.
“We have also seen a persistent decline in the number of investors depositing to exchanges, falling from 74k/day at the Nov ATH, down to 41k/day today. Meanwhile, exchange withdrawals are holding very steady at around 40k to 48k/day, again indicative of a consistent pool of HODLers withdrawing rain, hail or shine,” the report mentioned.
