The current price stagnation of Bitcoin has gained significant attention among analysts and investors alike. CryptoQuant, a famous on-chain analytics firm, pointed toward a notable similarity between Bitcoin’s present market behavior and the pattern that it saw in 2019, particularly focusing on the behavior of those who hold $BTC for 6 months or less.
#Bitcoin’s Price Stagnation“Currently, we can observe a small peak in UTXOs under six months, which resembles a similar structure seen in 2019 (red circle).” – By @avocado_onchain Read the full post https://t.co/VyKjWQN75Y pic.twitter.com/QC7J7kM4zM
— CryptoQuant.com (@cryptoquant_com) September 3, 2024
CryptoQuant Analyst Links Current Bitcoin Stagnation to the Scenario in 2019
A CryptoQuant analyst going by “Avocado_onchain” shared an analysis report to discuss the current Bitcoin stagnation. As per the analyst, the Unspent Transaction Outputs are a chief tool for a better understanding of investor behavior. The respective instrument denotes $BTC’s transacted amount which has not been spent yet. This essentially reflects the Bitcoin holders’ movements.
By examining the UTXOs in line with their lifespan, it is easy to classify diverse investor groups. Those who hold UTXOs for 6 6-month or less period come in the category of new investors. However, the seasoned market members include those who hold $BTC for a longer time. At present, there is a little but notable peak in the respective UTXOs within the category of new investors.
This pattern resembles the market structure witnessed back in the year 2019. The respective development denotes that several new investors will become a part of the market around 2024’s March. At that time, the price of the chief crypto token was at a comparative peak. Nonetheless, the decreasing proportion of the respective UTXOs points toward the exit of some exclusive investors.
The potential reason behind this is the frustration regarding the stagnant price of Bitcoin. Otherwise, they have kept holding and currently stand among the longer-term investors. In 2019, an analogous scenario took place near the Bitcoin halving. After that period, Bitcoin took up to 490 days to touch an exclusive all-time high.
The Present Scenario of the Bitcoin Market Requires Patience
The respective historical context offers an agenda to comprehend the present market dynamics. They highlight the requirement for patience in the case of the short-term outlook. According to the CryptoQuant analyst, the present price-movement deficiency in $BTC, which has continued for above 6 months, can be credited to several factors. They take into account a heightened over-the-counter trading in comparison with exchange-based trading.
