Bitcoin Investors Reach All-Time Low in On-Chain Spending: Glassnode

On Aug. 14, on-chain analytics provider Glassnode published its weekly market update, but there wasn’t much to report.

Markets have hardly moved over the past week, and volatility is at record lows. The Bitcoin market has reached a stage of “extreme apathy and exhaustion,” it said before adding that volatility and several key on-chain indicators are reaching all-time-low readings.

The #Bitcoin market has reached a stage of extreme apathy and exhaustion, with volatility measures and several key on-chain indicators reaching all-time-low readings. With the market being somewhat top-heavy, we assess how investors are responding to the boredom.

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— glassnode (@glassnode) August 14, 2023

Sluggish Bitcoin Market Inflows

Investors are reaching an all-time low in “willingness to spend coins on-chain,” the report noted.

“The conditions of the Bitcoin market continue to resemble the bear market hangover seen in prior cycles, with an outsized wealth held by long-term high conviction holders.”

The Realized Cap metric represents the cumulative capital inflow since inception. More than $16 billion in value has flowed into Bitcoin so far this year, but the growth is very shallow compared to previous cycles.

Moreover, the sluggish inflows could be compounded by the fact a large majority of the Bitcoin market is still underwater on their holdings, it said. This could create further resistance throughout the recovery.

It added that the supply held by long-term holders continues to increase, hitting a peak of 14.6 million BTC. Conversely, short-term holder supply has fallen to a multi-year low of 2.56 million BTC, it added.

“Overall, this suggests that conviction of Bitcoin investors does remain impressively high, and very few are willing to liquidate their holdings.”

Furthermore, the fear and greed index, currently showing 53, has remained neutral for months now with no movement in either direction.

There are still a few dark clouds on the horizon that could keep crypto markets suppressed for a while.

The United States is still at war with the industry, and Ripple could still lose its case. The specter of recession is still looming in America, which means less money to invest in high-risk assets.

Crypto Market Outlook

As evidenced by the on-chain analysis, crypto markets still haven’t moved this week. Total capitalization remains where it was five months ago at $1.2 trillion.

Bitcoin is trading flat at $29,350, while Ethereum remains stuck at $1,840 at the time of writing.

On the bright side, crypto markets are still up 46% since the beginning of the year and have moved off the bear cycle bottom, so it’s not all doom and gloom.

Moreover, some analysts have predicted a new BTC all-time high around the halving in eight months’ time though that appears very unlikely at the moment.