Is Bitcoin changing hands or being exchanged for altcoins? – AMBCrypto English


HODLers are known to sell at the top of the market cycle. However, since the price rally in July 2020, dormant coins from 2017 and 2018 are selling at the current price level. Pioneer of on-chain analysis, Willy Woo recently tweeted saying,

Is BTC changing hands or being exchanged for altcoins?

Source: Twitter

In several instances in 2014, 2017, and 2018, HODLers have booked unrealized profits. However, Bitcoin’s price was an ATH in that case. Currently, the price is above $11300 and dormant coins getting sold at this price level may indicate the possibility of an upcoming drop in price. 

On the contrary, since the second week of October 2020, several altcoins have been performing well. Offering double-digit returns in a week or a 24 hour period and this is lucrative to HODLers. Based on CoinMarketCap’s on-chain analysis, 88% of HODLers have unrealized profits in their portfolio. In anticipation of a Bitcoin price rally, HODLers may book a couple of tranches of profits and wait. They may buy altcoins like ADA, XLM, or FIL based on their weekly and 24-hour returns and book profits in the short-run.

Is BTC changing hands or being exchanged for altcoins?

Trade Volume of FIL || Source: Coinmarketcap

This is evident from the sudden and unpredicted increase in the trade volume of FIL, in the past 5 days. From 31 million it increased to 155 million in a single day. Corresponding to this increase in trade volume, the price has increased by nearly 22% in one week. 

Altcoins are a lucrative option for another reason, Bitcoin’s volatility and volume are low. The recovery is taking longer than expected, even with the ushering in of smart money. It may be long before HODLers who purchased above $10000 would see an ROI of 100%. In the meanwhile, the ones who have persevered through $3k-$9k level are selling and turning in.

Is BTC changing hands or being exchanged for altcoins?

Map of spent HODLer BTC || Source: Whalemap

Holding an asset long enough comes with an opportunity cost. HODLers who are aware of Bitcoin’s potential long-term return have paid this cost and may be ready to take by selling Bitcoin and trading in Altcoins, or reducing risk exposure and switching to Bitcoin options. This move by HODLers does not signal towards a price drop. There is an equal possibility that this builds a bullish case for Bitcoin in the longterm and altcoins in the short term.





READ SOURCE

READ  Ethereum Price Analysis: With BTC Dominance Firmly at 65%, What’s Next for ETH? - Ethereum World News

LEAVE A REPLY

Please enter your comment!
Please enter your name here