Glassnode has talked about the four phases of Bitcoin accumulation and distribution during the past year in their latest report.
Bitcoin Accumulation Trend Score Shows Market Has Been Selling Recently
As per this week’s edition of the weekly Glassnode report, the market has observed four distinct phases in the last twelve months.
The relevant indicator here is the “accumulation trend score,” which tells us about whether market participants are accumulating or not right now.
Not only does the metric check how much investors are buying/selling, but it also takes into account the size of holdings of these participants. As such, the score provides a higher weightage to larger holders accumulating/distributing.
When the value of this metric is closer to 1, it means that big participants or a large part of the network has been accumulating during the past month.
On the other hand, the indicator’s value being near zero implies large holders have either not been accumulating recently, or outright distributing their coins.
Now, here is a chart that shows the trend in the Bitcoin accumulation trend score during the last year:
The value of the metric seems to have been closer to zero in recent days | Source: Glassnode’s The Week Onchain – Week 36, 2022
As you can see in the above graph, the market seems to have gone through four phases of the Bitcoin accumulation trend score over this period.
Following the all-time high back in November, investors aggressively accumulated the “dip” as the value of the indicator was almost exactly 1. This marked the first of these phases.
Next, as the price slowly came down, these recent accumulators went into significant loss. This lead to the holders shifting to a trend of distribution.
In the third phase, even though the price plunged down even harder as the LUNA collapse took place, investors once again started accumulating as if attempting to catch the bottom.
After this months of accumulation, the market finally saw a rally above $24k. However, instead of continuing to buy more, holders quickly latched onto this opportunity of exit liquidity and engaged in profit-taking.
As a result of this distribution, this new fourth phase has observed Bitcoin accumulation trend score values close to zero.
At the time of writing, Bitcoin’s price floats around $19.8k, down 2% in the past week. Over the last month, the crypto has lost 15% in value.
The below chart shows the trend in the price of the coin over the past five days.
Looks like the value of the crypto is still moving sideways | Source: BTCUSD on TradingView
Featured image from Yiğit Ali Atasoy on Unsplash.com, charts from TradingView.com, Glassnode.com
Renowned billionaire hedge fund manager Stanley Druckenmiller says he could see cryptocurrency “having a big role in a Renaissance because people just aren’t going to trust the central banks.” He added that he will be “stunned” if the U.S. isn’t in a recession next year. Stanley Druckenmiller: People Just Aren’t Going to Trust Central Banks […]
At the MEXC afterparty “M&M Launcher,” which took place on September 28, during the Token2049 event in Singapore, MEXC Exchange officially announced that its fund had been upgraded to M-Ventures and received a new management group. Through strategic investments, mergers and acquisitions, funds of funds, and project incubation, the upgraded M-Ventures is a comprehensive fund […]
The Bitcoin Policy Institute’s report on CBDCs makes a strong case for why the US should reject a centrally issued version of the dollar. Bitcoinist covered that already. This time, we’ll focus on the reasons why The Bitcoin Policy Institute thinks CBDCs don’t make sense and are not practical for capitalist societies. The main argument […]
A GameFi ecosystem called Apejet aims to introduce blockchain technology’s potential to the gaming industry. The Apejet ecosystem seeks to build a platform that enables game developers to raise money by integrating Apejet into their games and making JET tokens the rewards players receive. Selling JET tokens to players would allow game developers to raise […]
One of the most notable features of cryptocurrency is its ability to enable instant cross-border payments, which has attracted a widening number of territories so far. Around 105 countries have tapped the technology, with some currently in the final stages of launching their Central Bank Digital Currency (CBDCs), like China. Others, like Sweden and Israel, […]
U.S. Citizens might be able to invest in Bitcoin and digital assets as part of their pension and retirement plans, according to the Retirement Savings Modernization Act. Introduced by U.S. Senators Pat Toomey, Tim Scott, and Representative Peter Meijer. Related Reading: Facebook And Instagram Will Allow Users To Connect Their Crypto Wallets The bill was […]