Weak hands panic sell $1.1M Bitcoin and the old hands hodl
While noobs are selling their Bitcoin out of panic, more experienced hodlers are reclining on their sofas and waiting for the bulls to show up.
Weak hands are panic selling, but veteran holders are hodling since they’ve been through a lot of similar situations. This major wave of selling is mainly attributed to Tesla CEO Elon Musk’s ideas and tweets that suggest that this company may sell their share of BTC which led to a major fall in BTC price that was unprecedented in the past 20 weeks.
BTC’s plunge increased the fear among the newcomers to the market who sold their assets at lower prices due to lack of enough experience and made loss while in the meantime, the ones with more experience and patience stuck to their holdings and are waiting for the proper time to sell according to Glassnode, the on-chain analytics provider.
This on-chain analytics provider also said that Bitcoin’s aSOPR or adjusted Spent Output Profit Ratio dropped below 1.0 among this drop. An aSOPR tells you if BTC was in profit or at a loss at the time it was transacted the last on-chain and if aSOPR falls below 1.0, it implies the on-chain realization of aggregate losses which have been noticed mostly in short term holders (coins that were held less than 155 days), that is 2021 bull market traders who bought some assets.
During this correction, over 1 million positions were liquidated by the traders. As a result, the overall number of non-zero BTC balance has dropped by 2.8%. Glassnode said:
A total of 1.1M addresses have spent all coins they held during this correction, again providing evidence that panic selling is currently underway.
Having compared the supply distribution patterns around the macro peak in the bull season in 2017 and the recent ones, Glassnode, the on-chain blockchain analyst believes that the supply share volatility of short-term holders suggests panic selling. A macro peak appears when a large share of the total supply is held by the new holders.
Short term holders’ Bitcoin total supply: Glassnode
As we can see in the graph above, a peak of 28% was recorded for the coins held by short-term holders.
Since hitting an ATH of $63,600 on April 13, BTC has lost its value by 28% says Glassnode. And it must be said that this correction is the deepest of the current bull market.
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