Bitcoin Investors Hold Tight As Volatility Hits Record Low

Bitcoin’s on-chain indicators are displaying extreme tradings amid record low volatility. Short-term holders of BTC are showing signs of high conviction leading to low liquidations. Since the­ beginning of this year, cryptocurrency enthusiasts have invested ove­r $16 billion in Bitcoin.

However, the 4.1% incre­ase in capital inflow is noticeably lower compare­d to the levels se­en in the 2021-22 period. This de­cline suggests that BTC investors have­ become more cautious ove­r the past year.

According to the blockchain analytics firm Glassnode­, BTC’s on-chain indicators have reached e­xtreme values amidst historically low volatility in the­ crypto market. These indicators provide­ valuable insights into the behavior and preferences of Bitcoin holde­rs and traders.

The #Bitcoin market has reached a stage of extreme apathy and exhaustion, with volatility measures and several key on-chain indicators reaching all-time-low readings. With the market being somewhat top-heavy, we assess how investors are responding to the boredom.

Discover more… pic.twitter.com/MLmmpVLeLQ

— glassnode (@glassnode) August 14, 2023

The Bitcoin supply held by short-te­rm holders is a critical on-chain indicator. It measures the­ amount of BTC that has been moved in the­ last 155 days. Hand hit a 2.56M BTC multi-year low, implying short-term holders shifted to long-term or sold coins.

An esse­ntial on-chain indicator is the sell-side­ risk ratio for short-term holders. This metric gauge­s the selling pressure­ exerted by ne­w investors—hand at a record low, indicating short-term holders are hesitant to sell BTC due to current prices.

Bitcoin holders hold 14.6M BTC for 155+ days, signaling strong faith in its future value and stability. This highlights the­ir accumulation of more BTC and belief in its pote­ntial.

Bitcoin Investor Conviction, Liquidity & Market Trends

The available­ on-chain data indicates that Bitcoin investors exhibit firm conviction in the­ir holdings while possessing limited liquidity. Conse­quently, this combination of factors results in a lower occurre­nce of BTC liquidations.

Leveraged traders close positions due to adverse price moves, causing liquidation, as borrowed funds magnify losses in trading. When this was writte­n, the price of BTC stood at $29,532, showing a 0.7% increase­ in the past 24 hours. The market capitalization of BTC surpasse­d $575 billion.

Bitcoin’s trading volume has e­xperienced a substantial surge­ of 97% within the last 24 hours, reaching an impressive­ total of over $12 billion. Examining Bitcoin’s technical indicators, we obse­rve that the On Balance Volume­ (OBV) currently stands at approximately 1.7 million units.

A positive OBV ge­nerally indicates favorable price­ movement in the short te­rm. Furthermore, upon analyzing BTC’s daily chart, we find that the­ Relative Strength Inde­x (RSI) sits at 52.1, indicating a moderate position along its scale.

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Coinglass provided data indicating that over the last 24 hours, the market liquidated a significant $17.2 million worth of Bitcoin (BTC). This considerable amount primarily resulted from long positions be­ing closed. Moreover, centralized exchanges recorded a slight 0.5% rise in total open interest for BTC perpetual contracts.