Measuring Bitcoins [BTC] price trends when the key metric reaches a new high

• Bitcoin’s active addresses defy expectations, set new record and potential market changes.
• Long-term holders of Bitcoin rise to an all-time high, with implications for future price dynamics.

A recent deviation from one of the Bitcoins [BTC] key metrics that can significantly affect the price trend have just been observed per new data. This unexpected shift has caught the attention of investors and analysts alike as they try to decipher the implications for the cryptocurrency’s trajectory.

Read Bitcoin (BTC) Price Prediction 2023-24

Furthermore, some reports suggest that a gradual shift in the behavior of BTC holders was affected by the FTX collapse. Coins that have not been used since the event slowly become part of long-term holdings.

Bitcoin active addresses set record

Like many other financial assets, Bitcoin is subject to trends and patterns that can provide insight into price movements. New data from Cryptoquant has revealed a fascinating twist in Bitcoin’s active address pattern.

The chart indicated that Bitcoin’s price tends to rise after a hash rate drop when the number of active addresses exceeds a certain range. For most of this year, the number of active addresses fell between 900,000 to 1.1 million addresses per day.

However, the pattern collapsed on May 1. Active address calculations soared to a new record of almost 1.3 million – the highest figure in over a year.

The increase in active addresses suggests a potential shift in market dynamics, sparking interest and speculation among traders and analysts alike.

Source: CryptoQuant

Post-FTX Bitcoin shifts to long-term holdings

In the wake of the FTX collapse, an intriguing phenomenon was observed: a gradual accumulation of unused BTC. These coins, untouched for a period of more than 155 days, tend to move into long term holdings (LTH).

Data from Glass node revealed a staggering 14.3 million coins that fall under this category. This accumulation also drove the number of long-term holders to an all-time high, accounting for a remarkable 74% of the circulating supply.

Possible trigger for the address calculation

The disruption in the pattern of active addresses can be partly attributed to the enthusiasm surrounding the Ordinals craze.

Furthermore, data from Dune Analytics indicated that daily inscriptions experienced a significant increase on April 1st. The increase coincided with the day the active address calculation reached its highest point in almost a year.

This suggested a connection between the influx of new participants and the increase in active addresses.

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Implications of LTH activation

Additionally, with the shift in the long-term holding (LTH) threshold, approximately 26% of the total Bitcoin supply was currently active. This meant that long-term investors hold a significant portion of Bitcoin.

That too is important to consider the potential impact if these long-term holdings were to be introduced to trading. The influx of such a large supply could trigger a price drop.