Momentum is building in Bitcoin. The asset has never been healthier fundamentally, and its most important indicators are all screaming buy.
On-chain activity, hash rates, and BTC supply metrics also support this. In fact, one BTC supply data point has now reached a level that last time led to the greatest bull market in crypto history.
Bitcoin: First Of Its Kind Financial Asset Requires Unorthodox Fundamental Analysis Tools
Bitcoin is an asset unlike anything else that exists today. It’s just over a decade old. And while many cryptocurrencies were made in its image, none are privy to the same level of acceptance and adoption.
Unlike stocks that derive their valuations from things like company revenue, crypto assets create value through utility and their networks.
Because the value of the native asset relies on the underlying protocol, fundamental analysis looks at the health of this network. This involves hash rates, the cost of production, mining difficulty, transactions, and supply.
The beauty of blockchain that Bitcoin birthed with its creation, is that all distributed ledgers are fully transparent. This means that anyone can look up public transactions and wallet data.
Wallet addresses may not be easily tied to individuals. But the way blockchain works, the total value stored and all transactions flowing in and out of the wallet are visible.
Advanced tools have been developed to monitor blockchain data and the movement of BTC through addresses and across the network. Understanding if wallets, particularly the largest wallets, are holding BTC for the long term, can provide insight into coming trends.
If more large investor wallets are increasing in supply and aren’t moving that supply in months, it could be a sign of an uptrend brewing. And that’s exactly what data is showing now.
Only 38.5% of the total Bitcoin Supply has moved in the previous year, the lowest level since early 2016 pic.twitter.com/8DgTvL110H
— CoinMetrics.io (@coinmetrics) July 1, 2020
Just Over One-Third of BTC Supply Has Moved in Last Year, Lowest Since Last Bull Run Began
According to BTC supply data, only 38.5%, or just over a third of all BTC supply, has moved in the previous year. The remaining nearly two-thirds of circulating BTC supply, haven’t moved in over a year.
This metric has now fallen to a level not seen since 2016, just ahead of the bull market that propelled Bitcoin into the public eye.
Related Reading | The Crypto Market’s Most Accurate Tool Says New Bitcoin Uptrend Is Here
Actively moving BTC supply dropped to this bullish low in 2016 and stayed grinding near the low until mid-to-late 2017. Then, Bitcoin prices reached highs too attractive not to sell, and the asset started moving again.
During that time, the cryptocurrency took the world by storm and rallied from $1,000 to $20,000.
This data indicates that more Bitcoin investors and wallets are holding in anticipation of the next bull market. Not even the Black Thursday collapse was able to shake out these strong hands, and nothing possibly will.