Bitcoin ‘New’ Investor Sharp Echoes 2019 BTC Price – Analysis
Bitcoin (BTC) is giving “new investors” a run for their money, similar to what it did before its 2020 all-time high, an analysis says.
In a Quicktake blog post on September 2nd, onchain analytics platform CryptoQuant compared current short-term holder trends to mid-2019.
Bitcoin's all-time high buyers face a dilemma.
Over the past six months, Bitcoin buyers have sold at a loss after half a year of BTC price action.
According to CryptoQuant contributor avocado_onchain, the surge in UTXOs that are six months old or less reflects Bitcoin's most recent high of $73,800 in mid-March of this year.
“These are new investors who entered the market, probably around March of this year when the price of Bitcoin was at its peak,” the post wrote.
“The decline in the volume of these UTXOs means that these investors have exited the market, possibly due to losses in Bitcoin's sluggish activity, or have continued to hold on to groups of six months or more.”
Bitcoin Realized UTXO Age Bands Chart. Source: CryptoQuant
The accompanying chart shows new investor UTXO levels similar to 2019, when BTC/USD hit a major high in the area before taking 500 days to avoid an all-time high from December 2017.
In the year A similar structure occurred around the halving event in 2019, and after that it took 490 days for Bitcoin to reach a new all-time high (ATH) – of course acknowledging the impact of the Covid-19 pandemic,” the post continues.
New investors are “crucial” for BTC's price gains
The “new investor” set differs from the classic understanding of “short-term holders”, the latter defined as entities holding a given amount of BTC for up to 155 days.
RELATED: Bitcoin Price Closes to $60K, But Traders Still See Bearish September
The price basis of these estimates often forms key support during bull markets but is currently well above price, with short-term holders taking total unrealized losses.
“Currently, the price of bitcoin has been stuck in a large range for more than six months, with no clear breakout,” reports avocado_onchain.
“While I have no doubts about the long-term upward trend, in the short-term, I believe it is wise to temper expectations and monitor the market closely. Historically, capital inflows from new investors have been a critical factor in Bitcoin's price appreciation.”
As Cointelegraph reports, other onchain data also points to a similar landscape from four years ago.
Bitcoin hash value, which measures the cost of production for miners, is at a level that may represent a long-term BTC price floor.
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
