Bitcoin Forum

During the recent capitulation event, Bitcoin migrated from weaker hands, to those stepping in at the lows. In this edition, we explore how we can assess the migration of conviction by use of coin age bands.

Summary and Conclusions:

In this newsletter, we assessed the relative distribution of supply and wealth for both Young and Old coins, to further understand the Bitcoin ownership structure. We established that the supply has undergone a significant transfer of wealth in recent months, with an observable and widespread capitulation, and thus equal and opposite accumulation.

Long Term Holder Supply has seen a local, modest decline as spending behavior dominates following the LUNA collapse. However, LTH supply remains relatively range bound, which indicates more contained spending by a sub-set, rather than broad loss of confidence.

In contrast, Short Term Holders are seeing a divergence between BTC and USD denominated wealth. This is indicative of a pool of buyers who stepped in at the lows, and now hold some 300k BTC, acquired at a much lower cost basis. Now we turn to see if they have the conviction to hold on.