The Decline in the Cryptocurrency Market: Unveiling the Possible Reason by CryptoQuant
The recent downturn in the cryptocurrency market may have a clear explanation, as suggested by data from CryptoQuant. Long-term Bitcoin holders and miners have emerged as the primary sellers of BTC in the past two weeks, with little indication of new demand, according to the on-chain analysis firm.
Monitoring of Bitcoin wallets by CryptoQuant has revealed that whales, referring to large token holders, have offloaded over $1.2 billion worth of BTC in the last fortnight. These sales likely occurred through intermediaries rather than directly on the market.
The report notes that traders have not been increasing their Bitcoin holdings, and demand from whales remains weak. Additionally, stablecoin liquidity is dwindling at the slowest rate since November 2023.
Interestingly, traders have been reducing their holdings since BTC surpassed $70,000 in late May. This trend is mirrored in the decreasing Unspent Transaction Output (UTXO) age bands tracked by CryptoQuant.
UTXO, which represents the unspent output from Bitcoin transactions, is a tool used by traders to monitor buying and selling patterns in the market. A decline in UTXO age indicates increased Bitcoin activity and suggests further selling, while an increase implies greater retention in the market.
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