Bitcoin (BTC)Crypto News

Bitcoin keeps crashing? Long-term holders increase sales

On-chain data shows that the long-term holders of Bitcoin have ramped up their selling lately, which could lead to another plunge in the crypto price.

Bitcoin exchange inflow CDD has skyrocketed over the last day

As one analyst pointed out in a CryptoQuant post, the current surge in CDD is the biggest since Oct. 6.

A “Coin Day” is the amount that accumulates 1 BTC after it has been quiesced at a single address for 1 day. Eventually, when a coin that has accumulated some Coin Days is moved to another wallet, its Coin Days counter is reset, and the Coin Days are said to be “destroyed”.

The Coin Days Destroyed (CDD) metric records the total number of such Coin Days destroyed across the network on a given day.

Another version of this indicator is the Exchange Inflow CDD, which only measures Coin Days reset due to transactions on centralized exchanges.

Now here is a chart showing the trend of the Bitcoin exchange CDD inflow over the past month:

Bitcoin keeps crashing?  Long-term holders increase sales, Crypto Trading News

The value of the metric seems to have skyrocketed over the past day or so | Source: CryptoQuant

As you can see in the chart above, Bitcoin exchange inflow CDD has shown a sharp increase in its value lately.

There is a cohort in the BTC market called the “Long-Term Holder” (LTH) group, which includes all investors who hold their coins for long periods of time without moving them.

Related Reading: Bitcoin’s capitulation deepens as aSOPR metric plummets to December 2018 lows

Due to the dormancy of their coins, these LTHs accumulate a large number of Coin Days. Therefore, whenever these holders move their coins, the CDD usually increases due to the size of the coin days involved.

So, the recent surge in bitcoin exchange inflow CDD suggests that some LTHs have deposited their coins on exchanges.

Since the exchanges in question are spot platforms, it is possible that this coin movement was for the purpose of selling.

The chart shows that the previous two major peaks of the indicator were followed by a decline in the price of bitcoin.

If the recent surge is also due to LTHs preparing to sell their coins, then the crypto is likely to see a bearish trend this time as well.

BTC price

At the time of writing, the price of Bitcoin is hovering around $16.4K, down 2% over the past week. Over the past month, the crypto has lost 15% in value.

Bitcoin keeps crashing?  Long-term holders increase sales, Crypto Trading News

Looks like the price of the coin has been moving sideways again for the past few days | Source: BTCUSD on TradingView Featured image by Zdeněk Macháček on Unsplash.com, charts by TradingView.com, CryptoQuant.com

Source: Crypto News Deutsch

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button