Bitcoin Uptrend Intact as HODLers Seem Less Tempted to Sell

The near two-fold rise in bitcoin (BTC) over the past year has rewarded long-term holders (hodlers) who are still in the accumulation phase. This suggests that, following bitcoin’s break to an all-time high above $63,000, bullish activity is just getting started.

BTC is roughly 3% lower at the time of writing after reaching an all-time high around $64,800. But despite short-term profit taking, the long-term uptrend is intact.

"It is likely that the coins purchased by institutions in late 2020 and early 2021 are starting to mature,” according to a recent report by Glassnode, a cryptocurrency analytics firm. “The HODLer Position Change metric is trending higher and if these institutional buyers did HODL, it is likely to continue in this trajectory over the coming months.”

Glassnode’s "coin years destroyed" (CYD) metrics track the number of days represented by each hodling "streak" within a 365-day period before that streak ends or is "destroyed." CYD is currently trending higher at a level like the 2013 BTC price top, but still well below the 2017 top.
“Given the bitcoin network is older, and coins in supply have had more time to accumulate, if many HODLers were spending their coins, we would expect a relatively large CYD reading.”
In general, HODLers are not spending their old bitcoin, which suggests the current bull market still has legs.

CoinDesk - Unknown — Chart shows Glassnode's coin years destroyed (CYD) metric, which indicates less HODLer selling versus prior peaks.

Macroeconomic factors could be a driving force for long-term bitcoin holdings. Many investors see bitcoin as a hedge against inflation and continued dollar debasement. And the search for yield could encourage greater flows into bitcoin.

“We could see flows out of fixed income and into cryptocurrencies as rates rise,” said Mati Greenspan, founder of Quantum Economics, a market analysis and advisory firm, during an interview with CoinDesk. This could usher in a new generation of HODLers seeking high-yield potential.

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Damanick Dantes

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