Bitcoin flashes signs of resiliency as October growth holds steady

More than two-thirds of the asset’s total supply is now held by individuals likely to be long-term holders

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Bitcoin (BTC) is less than six months from its next halving event anticipated for the start of April next year, leading to analyst speculation on the effect on its price trends. 

The asset is up more than 66% year-to-date to $27,600 after posting its first September win in seven years. Recent data indicates nuanced shifts in the crypto’s behavior, according to Cathie Wood’s Ark Invest. 

In its latest “The Bitcoin Monthly” report, the asset manager noted several noteworthy observations, including that the asset may be in “cyclically oversold territory.”

“Bitcoin’s Realized-Profits-to-Realized-Cap closed September at 0.02%, slightly above 0.01%, its yearly low. This oversold condition has occurred only seven times in bitcoin’s history,” the report said.

ARK’s data also indicated a significant concentration of bitcoin with long-term holders. It comes despite a dip in the asset’s price on Monday which some are attributing to the ongoing conflict in the Middle East.

Specifically, 76% of bitcoin’s total supply is now held by individuals who have not transacted in over 155 days. This could imply a reduced availability of bitcoin for active trading, Ark said.

Blockchain analytics firm, Glassnode, reported last week that the total bitcoin held long-term or presumed lost has hit a five-year record, exceeding 7.9 million BTC. 

In the broader financial landscape, bitcoin’s price movement appear to be diverging from traditional equity markets, a spokesperson for Bitfinex analysts told Blockworks.

Bitcoin’s price has recalibrated ahead of the S&P 500’s recovery from its 4,200-point low earlier this month. According to their analysis, correlation metrics showed bitcoin’s alignment with equities, which stood at 0.8 on August 25, has since fallen considerably.

By September, the correlation had flipped to -0.5, indicating a contrast to the movements of the world’s foremost digital asset and traditional equities. 

“This is usually observed in situations where there is a sudden bullish or bearish development for either asset class or if either bitcoin or the US stock market prices in information at a faster pace than the other,” the spokesperson said.


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