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Data shows that Bitcoin‘s on-chain activity is currently at levels seen before reaching the all-time high in 2021. Ki Young Ju, the CEO of CryptoQuant, revealed in a tweet on August 25th that Bitcoin’s velocity is at its lowest levels in years.
Bitcoin Supply Stagnates at $26,000
Bitcoin is becoming increasingly stagnant at current price levels. With no significant price trend for months, the driving force for buying or selling is diminishing. This is highlighted by the velocity, which measures the movement of BTC units on the network.
According to CryptoQuant, the metric is currently at levels last seen in October 2020. This situation has two sides, as it can be seen as positive because whales are holding onto Bitcoin or negative because it is not being transferred to new investors.
This can be seen as positive because whales are holding onto Bitcoin or negative because it is not being transferred to new investors.
As part of a comment that indicates the market is in a “wait and see” mode, it is referenced that there is a lack of significant buying and selling activity among high-volume investors. According to the statements made, notable new developments can be observed at the beginning of the year when BTC/USD started its 1st quarter gain series, reaching 70%.
What about Bitcoin Sales?
Meanwhile, volume data appears to be significant for another reason. After making a long-term bottom in late 2020, the recovery of the metric accompanied Bitcoin’s surge to an all-time high of over $20,000 a year later.
However, unlike back then, Bitcoin seems to be generally oversold at the current level of $26,000 according to the measured daily relative strength index (RSI), which could imply a decreasing confidence among people. Furthermore, the 12-hour RSI reached its lowest level in the past five years this month and has not yet recovered, indicating that investor interest has not yet materialized.
