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.