On-chain data shows Bitcoin long-term holders have just ramped up their selling as the binary CDD metric shoots up.
Bitcoin Binary Coin Days Destroyed Has Observed A Surge
As pointed out by an analyst in a CryptoQuant post, long-term holders may be using the recent surge as an opportunity to distribute their coins.
A “coin day” is said to be the amount that 1 BTC accumulates while sitting still for 1 day. Thus, the total number of coin days in the market refer to the overall time the Bitcoin supply has been dormant for.
Whenever any coin moves on the chain, the coin days associated with it turn back to zero. The “coin days destroyed” is an indicator that measures precisely this, for the entire market on any given day.
Whenever this metric’s value spikes up, it means a large amount of dormant supply, likely belonging to the long-term holders or “hodlers,” has just been sold or moved.
One way to interpret the data associated with this indicator is through the “binary CDD” metric. Here is a chart that shows the trend in it for the last one year:
Looks like the value of this metric has spiked up in recent days | Source: CryptoQuant
What the binary CDD tells us is whether Bitcoin long-term holders are making more moves than average or not right now.
When the indicator’s value moves towards 1, it means the LTHs are possibly putting selling pressure on the market currently. On the other hand, values pointing towards 0 imply LTHs aren’t moving that many coins at the moment.
Now, as you can see in the above graph, whenever the binary CDD metric has observed rising values during the past year, the price of the crypto has generally observed a sharp decline.
Recently, the indicator has once again seen an uplift in its value while the price of Bitcoin has also trended up.
This could suggest that LTHs are using this surge in the price as an opportunity to harvest some profit by selling off some of their coins.
If the past trend is anything to go by, this spike in the binary CDD could prove to be bearish for the value of Bitcoin.
At the time of writing, Bitcoin’s price floats around $21.7k, up 9% in the past week. Over the last month, the crypto has lost 9% in value.
The below chart shows the trend in the BTC price over the last five days.
The value of the crypto seems to have observed upwards momentum during the last few days | Source: BTCUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, CryptoQuant.com
Following the Bank of England explaining that it would be meddling in U.K. bond markets and the Bank of Japan defending the yen in the foreign exchange market last week, the Hong Kong Monetary Authority (HKMA) revealed it intervened in forex markets on Wednesday. Hong Kong’s central bank detailed that it interfered in forex markets […]
Volatility in cryptocurrency markets remained high on Thursday, as markets began to consolidate following a recent red wave. Bitcoin was back above $19,000 in today’s session, with ethereum also rebounding following recent losses. As of writing, the global crypto market cap is up 2.43% Bitcoin Bitcoin (BTC) was trading higher on Thursday, as crypto markets […]
While bitcoin is down more than 72% from the crypto asset’s all-time high, bitcoin mining operations are expanding at a rapid pace during the downturn. On Tuesday, the bitcoin miner Cleanspark said its hashrate has surpassed 4 exahash per second (EH/s), and the Texas mining company Rhodium revealed it raised $11.9 million, according to a […]
Abdulla bin Touq Al Marri, UAE Minister of Economy, launched the Ministry’s headquarters in the metaverse which is the “digital twin” of the department’s office in Dubai and Abu Dhabi. UAE seems to be leading the race in becoming the crypto hub of the world. Crypto giants including Binance, Crypto.com, Kraken, OKX have already set […]
Bitcoin (BTC) trading volumes against the British pound (GBP) surged to a new high after the Sterling wobbled on Tuesday, prompting market experts to speculate that investors scrambled to dispose of the Pound in exchange for Bitcoin or to profit from arbitrage. The British pound reached a record low against the U.S. dollar, according to data compiled by […]
There are many ways to support cryptocurrency networks’ security and day-to-day operations. Staking is an excellent way to foster broad community participation, assuming it is convenient and accessible. For holders of the $ORBS token, that process is now available through the OKX exchange. OKX Supports $ORBS Staking Cryptocurrency exchanges have transformed in recent years. It […]