The movement of crypto holders is often scrutinized. Especially given the recent price volatility of Bitcoin (BTC). According to analysts at Bitfinex, the current actions of Bitcoin owners on the blockchain bear striking similarities to those of December 2020. This parallel suggests a possible growth phase for the cryptocurrency.
Analysts see Bitcoin’s growth phase in an extension
December 2020 was a crucial time for Bitcoin as the price began to rise significantly after a long period of consolidation. A consolidation period refers to a period during which the prices of an asset remain relatively stable within a certain range after a period of volatility or large price movements.
Bitfinex analysts are now noting that the current behavioral patterns of Bitcoin holders are similar to those of December 2020. So it seems that a similar trend is emerging. This is according to the Bitfinex Alpha report.
Bitcoin supply from long-term investors on crypto exchanges has fallen to its lowest level in 18 months, according to experts at Bitfinex. This means that these investors have less Bitcoin available to sell in the market. It is mainly the statistics of Bitcoins not moved in a year.
Bitcoin halving approaching, price rise threatened?
At the same time, Bitcoin supply is under pressure due to the upcoming halving, which means the reward for Bitcoin miners will be halved.
The Bitcoin halving is an event that occurs approximately every four years. The event results in a halving of the reward miners receive for validating transactions and adding new blocks to the blockchain. The next halving is scheduled for next Saturday, April 20th.
The combination of the above factors could lead to further Bitcoin price increases. This is because demand for the largest cryptocurrency may continue to outweigh supply. Bitfinex analysts say the following:
“Fundamental to Bitcoin’s price dynamics is this week’s halving, which, as it approaches, will see a significant increase in Bitcoin exits from centralized exchanges and a decline in inactive Bitcoin supply, which has not moved in over a year, “lowest level in 18 months.”
The analysts’ keen eye shows that the patterns are comparable to 2020. The share price was at the beginning of the next upward impulse. “This pattern suggests we may be entering a similar growth phase,” the analysts added.
