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Daily Bitcoin and Crypto Analysis

August 31 Daily Crypto Update: More people holding onto coins longer

August 31, 2021

Justin d'Anethan

Equity indexes continued to rise yesterday. Investors are still bullish risk assets despite concerns about having reached an economic growth peak, geopolitical risks, or the Fed hinting at tapering. And, as it did yesterday, with capital flowing to equities, the dollar and yields fell.

Looking at the crypto space, BTC is now staying still after yesterday’s 3% drop. We’re now hovering just above $47,000.

On the other hand, the BTC dominance edged down, showing at least some of the alts outperformed, and indeed, we see many coins in the green. 

SOL continues an incessant ramp up and gained 20% just yesterday. DOT rose 10%. COMP gained 4-5%. ETH is up 3%. Other projects like AAVE, LINK, STX, and ADA are green by at least half or a full percent and definitely doing better than BTC.

Looking at some on-chain data, Glassnode published a flurry of interesting charts.

On the bearish side, we see a general decrease in the number of active addresses or transaction volumes across BTC and other blockchain projects. With prices rising but activity remaining further down from the peak, it could suggest that the price gains are speculation-driven and not based on a fundamental gain in value.

On the bullish side, though, we’re seeing the very positive dynamic of more people holding onto coins longer. You see this through hodl waves, which are based on counting addresses that have kept coins instead of moving them for X amount of time. So far, the market seems to be trending towards longer-holding entities, and this is supportive.

You can see a similar dynamic in the ‘liveliness’ ratio, where there is more activity and back-and-forth from addresses during the bull-run or volatility events but a decreasing liveliness during consolidation and accumulation.

Another metric I picked up on is the rise in non-zero addresses. The drop from the all-time high to the 30Ks, then back up has been the catalyst for several people to get involved and hold at least some BTC. This is positive as well.

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