On-chain data shows that Bitcoin holders have recently done rapid new accumulation, something that could lead to bottoming for the cycle.
Bitcoin 1w-1m Realized Cap UTXO age groups are up sharply
As noted by an analyst in a CryptoQuant afterthe percentage of the realized BTC limit last moved between 1 week and 1 month ago has shown a rapid upward trend for the first time in this bear.
The “realized capis a Bitcoin capitalization model that values each coin in the circulating supply using the price at which it last moved. The metric then calculates the “true valuation” of BTC by adding up all these values of the individual coins.
This is different from normal market capitalization, where every coin in circulation has the same value; the current Bitcoin price.
The “realized limit – UTXO age groups” is an indicator that tells us the distribution of the realized limit of each age category in the market.
These age groups specify the range between which UTXOs (or more simply, coins) that fall into the said age range last moved.
The relevant age group here is the 1w-1m group, which includes all UTXOs who last moved within 1 week to 1 month ago.
Here’s a graph showing how the percentage of cap realized contributed by this age group has changed over the years:
Looks like the value of the metric has sharply gone up in recent weeks | Source: CryptoQuant
As you can see in the chart above, the realized limit of the 1w-1m Bitcoin UTXO age group has recently seen a rapid upward trend.
The older end of this range, i.e. a month ago, is around the time of the crash due to the FTX collapse.
So the rise in value of the indicator suggests that investors have again done some accumulation on the lows after this crash.
This is the first time in this Bitcoin bear market that such rapid new accumulation has occurred.
The chart shows that historically such increases have coincided with cyclical lows in price. Another interesting thing to note is that there were 1358 days between these spikes in the metric during the previous two cycles.
The current increase comes 1444 days after the previous one, which is the same length as the gap before it. If there really is a pattern here, then the Bitcoin bottom could be very close, if not already within.
BTC price
At the moment of writing, The price of Bitcoin floating around $16.8k, down 1% over the past week.
BTC plunges down | Source: BTCUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, CryptoQuant.com