What does it mean for the cryptocurrency market that 70% of bitcoins haven't been traded for 12 months?

Glassnode reports that traders have not traded about 70% of BTC, valued at over $800 billion, for the past 12 months. Investors who do not plan to sell them in the near future hold these coins.

This phenomenon, known as 'dormant bitcoins,' is one of the most interesting trends in the cryptocurrency market in recent years. It indicates that Bitcoin is gaining increasing value as a long-term asset.

There are several possible explanations for this phenomenon. Firstly, investors may associate it with the belief that the price of BTC will continue to rise in the long term. Secondly, they might simply be holding these coins as a long-term store of value. Thirdly, they could be associated with exchanges or other financial institutions that do not allow them to trade these coins.

Nevertheless, the 150% increase in the price of Bitcoin over the last 12 months is a positive sign for the cryptocurrency market. It means that the demand for BTC remains high, even though a large portion of the coins are held by investors who do not plan to sell them.

Here are some potential consequences of this phenomenon:

It may lead to further price increases for Bitcoin as the supply of coins in the market will be limited.

It may lead to a decrease in BTC volatility as a significant portion of the coins will be off the market.

More big investors might be drawn to Bitcoin, which could make institutions more interested in owning it.

Overall, this phenomenon is positive for the cryptocurrency market. Bitcoin still attracts investors who believe it has long-term value.

What experts say

Experts believe that the phenomenon of 'dormant bitcoins' is a sign that the cryptocurrency market is becoming more mature. They note that this phenomenon is similar to what happens with other traditional assets, such as gold or real estate.

Institutional investors are becoming more interested in BTC, according to Tom Lee of Fundstrat Global Advisors. They perceive it as a reliable asset for the long term.

"This could also lead to a decrease in Bitcoin volatility as a significant portion of the coins will be off the market," he added.

What awaits the Bitcoin market in the future

It's hard to say how the phenomenon of 'dormant bitcoins' will develop in the future. However, considering the growing interest in BTC from institutional investors, it can be assumed that this trend will continue.

If so, it could lead to further price increases for Bitcoin and a reduction in its volatility. This, in turn, could make Bitcoin more attractive to a wider range of investors