The data provided by Glassnode reveals that Bitcoin’s illiquid supply has reached an all-time high of 15.17 million. This indicates that a significant portion of the digital currency is held by entities and is not readily available for trading or selling, reflecting the ongoing trend of hodling among Bitcoin holders.
“Illiquid supply” refers to the amount of Bitcoin that is held by individuals or organizations and is not easily accessible for immediate transactions. Currently, a staggering 72% of the circulating supply falls under this category, highlighting the strong conviction of Bitcoin investors who choose to hold onto their digital assets instead of actively trading them.
What makes this development even more fascinating is the unprecedented rate at which this illiquid supply is growing. With the exception of the Luna crash and the collapse of FTX, no other events in 2023 have witnessed such a rapid increase in the number of coins becoming illiquid.
Over the past 30 days alone, a staggering 131,000 Bitcoin have transitioned into an illiquid state. This rapid pace sets a new record for the year 2023, underscoring the resolute mindset of Bitcoin holders who continue to hold onto their investments despite potential market volatility.
The hodling behavior exhibited by Bitcoin investors is reflective of a broader sentiment within the cryptocurrency community. It suggests a long-term investment strategy and a belief in the potential future value of Bitcoin, despite short-term price fluctuations.
While some might argue that a high illiquid supply could hinder the overall liquidity of Bitcoin and impede its use as a medium of exchange, proponents of hodling assert that it contributes to a stronger market and more robust price discovery mechanisms. By limiting the availability of coins for immediate trading, hodling is believed to create a scarcity that supports price stability and long-term growth.
As the cryptocurrency market evolves, the concentration of illiquid Bitcoin highlights the growing influence of long-term investors and institutions. These entities have a vested interest in Bitcoin’s success and are committed to holding their assets for extended periods, indicating a shift towards a more mature and stable market.
It remains to be seen how this increased illiquid supply will impact the price and trading dynamics of Bitcoin in the near future. However, the current trend of hodling, as demonstrated by the unprecedented rate of illiquid supply growth, suggests that Bitcoin holders remain confident in the long-term prospects of the cryptocurrency, and continue to view it as a store of value.
In conclusion, Bitcoin’s illiquid supply has reached a new all-time high of 15.17 million, with 72% of the circulating supply now considered illiquid. The rapid increase in illiquid coins, as witnessed in the past 30 days, sets a new record for 2023. This phenomenon underscores the persistent hodling behavior among Bitcoin investors, who exhibit a steadfast belief in the long-term potential of the cryptocurrency. As the market continues to mature, the concentration of illiquid Bitcoin reflects the growing influence of long-term investors and institutions, shaping the future trajectory of the digital currency.
Source: https://azcoinnews.com/bitcoins-illiquid-supply-reaches-record-high-72-of-circulating-coins-held-firmly-by-hodlers.html