An on-chain Bitcoin metric is suggesting that holders of BTC currently have very strong hands and are hesitant to let go of their coins, according to a Glassnode analyst.
In a new video update posted to the social media platform X, Glassnode’s lead on-chain analyst, who goes pseudonymously as Checkmatey, takes a look at the Bitcoin bull market correction drawdown metric, which measures how far price has gone down from the high after every significant rally.
According to Checkmatey, Bitcoin’s recent drawdowns have been uniquely shallow compared to previous bull runs.
The on-chain analyst says the metric suggests that the current holders of BTC are historically strong and reluctant to sell their coins, even after the approval of exchange-traded funds (ETFs) which was largely considered to be a “sell the news” event.
Says the analyst,
“In terms of just pure price, this has been my favorite for pretty much a whole year, because what we’re basically looking at is, again, anchoring each cycle to whatever the low point was. What is the max peak drawdown? So whatever the height we got to in that cycle, what is the peak drawdown?
In all previous cycles, we’ve seen very, very regular 25%, 30%, sometimes 60%, and 50% corrections during those uptrends.
Obviously, those 60% and 50% [corrections] you’re talking about March 2020 and various events like that, but you can see that these uptrends, we do get these fairly substantial drawdowns.
And we just haven’t had that. Even in the post-ETF [phase], which really did get a little bit frothy, we’ve only seen about a 20% correction. So in a way, it’s telling you that there is this interesting balance of both support on the buy side, but also a very, very strong reluctance by existing holders to actually liquidate their coins.”
At time of writing, Bitcoin is trading at $42,103.
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