The behaviour of long-term Bitcoin holders has not undergone significant changes in the wake of BTC new all-time high. Analysts at Glassnode concluded as much.
#Bitcoin hit a new ATH last week as the first futures ETF launched.
Open interest and volume in the underlying CME contracts increased 265%.
LTHs have taken strategic profits, but most are still waiting for higher prices.
Read More in The Week Onchainhttps://t.co/4CFjoAgOCE
— glassnode (@glassnode) October 25, 2021
The driver of the price records was the successful start of the first ETF based on digital gold in the United States. Open interest (OI) in Bitcoin futures on the CME, the contracts they underpin, jumped 265% since the start of October — from $1.49 billion to $5.44 billion.
Interest in the first Bitcoin ETF was so strong that ProShares, which launched it, had to switch to purchases of long-dated futures.
The sharply widened basis contributed to the active opening of shorts in the derivative instrument by leveraged funds.
Leveraged funds are opening new shorts of CME #bitcoin futures taking advantage of the widening basis pic.twitter.com/dVOpO8zP7a
— Coinbase Institutional (@CoinbaseInsto) October 25, 2021
Skew observations were confirmed by journalist Colin Wu. He noted that the spread between futures and spot prices reached $1,000. According to him, previously something like that had not been observed before.
According to https://t.co/6M8Z1C5H3K, there is a large spread between CME Bitcoin futures and spot prices, which can reach $1,000 at high times. The reason is that with the launch of Proshares Bitcoin futures ETF, its weight in CME Bitcoin futures contract holdings is too large. pic.twitter.com/KV54oHyGkA
— Wu Blockchain (@WuBlockchain) October 26, 2021
Not long before Bitcoin’s all-time high on the perpetual contracts, there was a local extreme in funding rates. This set off a rapid build‑up of long positions using leverage.
The subsequent correction brought this metric back to levels seen at the start of September. Analysts warned that, given record open interest, this does not rule out a new wave of price declines to reduce leverage.
The number of Bitcoins available to long-term investors over the past two weeks fell by 39,500 BTC. This is a small amount relative to 2.42 million BTC that have flowed into their wallets since the start of the accumulation phase in late March.
With signs of a return to accumulation in recent days, analysts interpreted the observed distribution as an \”episode\” rather than the start of a trend.
The HODL-waves indicator points to a modest uptick in the share of \”young\” coins as some of the \”old\” ones are spent. Experts emphasised that this is a characteristic story in the context of new record highs.
Coin Days Destroyed and Average Coin Dormancy metrics, which account for movement of older coins, indicated relatively moderate, rather than extreme, spending by hodlers.
“As the supply of long-term traders began to recover, the most likely interpretation of the metrics is that the overwhelming majority of coin holders are still waiting for higher prices.”, the analysts concluded.
As reported, from October 16 to 22 investors directed a record $1.47 billion into crypto funds, including $1.24 billion in two launched Bitcoin ETFs.
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