70% Of Bitcoin's Circulating Supply Hasn't Moved For Over A Year: Bitfinex Report

Bitcoin, the world's first-ever crypto asset, continues its uptrend as it sets new highs, breaking records. While many may expect holders to start dumping their Bitcoin holdings to make a profit, it appears that isn't actually the case. A new report from analysts at crypto exchange platform Bitfinex reveals the "huge conviction among Bitcoin holders to maintain their positions."

Bitcoin has set a new all-time high as a staggering 13.65 million BTC, equivalent to approximately 70% of the crypto asset's total circulating supply at 19,555,118 BTC, has not been transacted or moved for more than a year, according to the latest Bitfinex Alpha report shared with International Business Times.

Additionally, the number of Bitcoin that remained unmoved for more than two years is currently at 11.2 million, or nearly 60% of its total circulating supply. Bitfinex analystsdub it a "remarkable supply inactivity" since it represents "a significant underpinning of the price" and a "source of upward pressure as increasing demand chases limited supply."

The current Bitcoin velocity – the measure of the frequency of how the crypto asset is traded or used in transactions – is at its "historically low level of 15.78, which underlined the significant change in sentiment compared to the last bear market cycle, where Bitcoin velocity peaked at around 80."

These metrics show Bitcoin holders' reluctance to sell while buyers look for BTC supply, which is one of the factors why the king of crypto reached a new year-to-date high of $38,410 on Nov. 24.

Bitcoin has also reached a new milestone as nearly 84% of its total circulating supply is in profit, a feat it has not achieved since November 2021.

The recent surge in Bitcoin's value saw more than 16.366 million BTC, or 83.6% of the circulating supply, in profit, a level last seen in November 2021 when the crypto market had just retreated from its all-time high (ATH), on-chain marketing intelligence Glassnode said last week.

The Bitfinex Alpha report revealed that "83.7% of current holders are in profit, but selling pressure is so far muted." A reason for this trend is that "the actual size of these unrealized gains remains modest."

"From a statistical perspective, this is a noteworthy development. The current percentage of BTC held in profit is substantially higher than the all-time average of 74%," Bitfinex analysts said in a note sent to IBT. "Throughout the 2022 bear market, this first phase of re-accumulation among long-term holders (LTHs) has been consistent with past cycles, with a notable increase in LTH supply. This trend demonstrates the resilience of BTC holders, even in the face of growing unrealized losses experienced by this group in the last year."

"We are still in the early stages of a bull market and despite consistently making new year-to-date highs and signs of some slowing momentum while short-term holders (STHs) book profits, BTC continues to show strength while still in a range for the time being," they added. "There's a consistent pattern where the percentage of BTC held on U.S. exchanges increases significantly. This accumulation phase is seen as a key indicator of market sentiment, shifting toward optimism, as it is a representation of more interest from new market entrants in Bitcoin and crypto in general."

"We have seen that in previous cycles there is a direct correlation between balance on U.S. exchanges preceding a price increase, as a higher number of investors tend to buy and accumulate BTC, keeping their balances on exchange, before it begins to decrease as the bull markets pick up momentum," the analysts said.

Bitcoin, the world's largest crypto asset in terms of market cap, was trading in the red zone at $36,990.40 as of 4:25 a.m. ET on Tuesday, with a 24-hour trading volume up by 15.11% at $18,719,405,052. Bitcoin's price action represented a 1.0% decrease in the past 24 hours and a 0.9% loss in the last seven days.

Data from CoinMarketCap showed that BTC's circulating supply stands at 19.55 million BTC, while its value continues to fall by 0.94% at a $723,347,189,221 market cap.