According to a recent weekly report by Bitfinex, Bitcoin is still the dominant player in the market. However, it is facing challenges to maintain a continued price surge. The report also highlighted a key finding from Ark Invest's research, which showed growing support from strong holders and improved institutional sentiment toward Bitcoin.
The report revealed that as of early July, 70% of the existing Bitcoin supply of 19.4 million BTC has remained unmoved for at least 12 months. This indicates that Bitcoin's unmoved supply, which refers to the amount of BTC that hasn't been transferred in over a year, has reached an all-time high.
Bitcoin supply hits new high as rally resumes. Bitcoin Sees Growing Institutional Interest
Bitcoin is gaining interest from institutional investors who see it as a hedge against inflation. When large investors invest heavily in an asset, it indicates that they believe in its future value.
According to a report, several factors have contributed to the increase in long-term confidence among Bitcoin investors. One major factor is the news of major investment companies filing for Bitcoin spot ETFs, which has fueled more interest.
Over-the-counter (OTC) trading reached a one-year high in June, surging by 60% in the past quarter alone. Institutional investors are increasingly participating in OTC trading deals, indicating that BTC is becoming a preferred investment option. Bitcoin supply hits new high as rally resumes.
The recent increase in Bitcoin's unmoved supply can have a positive impact on its price. As more of the supply is held by long-term investors, the circulating supply decreases. Based on the law of supply and demand, when the supply decreases while the demand remains constant or increases, the price is likely to rise.
However, Bitfinex's report suggests that the recent news of BlackRock and other investment companies filing for a spot ETF has caused a surge of over 38% in Bitcoin Open Interest. This indicates that derivatives traders may be driving the current market momentum, which could negatively impact the price of BTC in the short term.
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Percent of Supply Last Active 5+ Years Ago Reaches All-Time High
According to on-chain data from Glassnode, Bitcoin's supply that has not been moved for over 5 years has reached an all-time high of 29.070%. This suggests that more people are holding Bitcoin as a long-term investment rather than using it for trading or spending. As Bitcoin has a fixed supply, the amount of unmoved supply is expected to increase as long as investment institutions like MicroStrategy continue to accumulate more of the cryptocurrency.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.