Bitcoin 'tourists' purged, only hodlers remain: Glassnode

So-called “market tourists” shun Bitcoin ( BTC ), leaving only long-term investors holding and transacting in the leading cryptocurrency,...


So-called “market tourists” shun Bitcoin (BTC), leaving only long-term investors holding and transacting in the leading cryptocurrency, according to blockchain analytics firm Glassnode.

In its week of July 4 Onchain reportGlassnode analysts said June saw Bitcoin have one of its worst performing months in 11 years, with a loss of 37.9%. He added that activity on the Bitcoin network is at levels concurrent with the deepest part of the bear market in 2018 and 2019, writing:

“The Bitcoin network is approaching a state where nearly all speculative entities and market tourists have been completely purged from the asset.”

However, despite the almost complete purge of “tourists”, Glassnode noted significant levels of hoarding, saying the prawn sales – those holding less than 1 BTC, and whales – those with 1,000 to 5,000 BTC, “increased significantly.”

Shrimps, in particular, see the current bitcoin prices as attractive and are accumulate it at a rate of nearly 60,500 BTC per month, which Glassnode says is “the most aggressive rate in history,” equivalent to 0.32% of BTC supply per month.

Explaining the purge of these tourist-like investors, Glassnode revealed that the number of active addresses and entities has trended downward since November 2021, implying that new and existing investors are not interacting with the network.

Address activity has grown from over 1 million daily active addresses in November 2021 to around 870,000 per day over the past week. Likewise, active entities, a grouping of multiple addresses held by the same person or institution, are now around 244,000 per day, which Glassnode says is around the “low end of the low channel.” “typical bear market” activity.

“HODLer retention is most evident in this metric, as active entities typically trend sideways, indicating a stable user base load,” the analysts added.

Source: glass knot

New entity growth also dipped to the lowest since the 2018-2019 bear market, with Bitcoin’s user base reaching 7,000 net new entities daily.

The number of transactions remains “flat and sideways,” indicating a lack of new demand, but also means that holders are being held back despite market conditions.

“It can be seen that the transactional demand is moving sideways throughout the main body of the bear”, – glass knot

Related: Institutional investors selling Bitcoin short accounted for 80% of weekly inflows

Driving home, Glassnode concluded that the number of addresses with a non-zero balance, those holding at least Bitcoin, keep on going hit all-time highs and currently has over 42.3 million addresses.

Past bear markets have seen a purging of wallets as the price of Bitcoin crashed. Yet, with this metric indicating otherwise, Glassnode says it shows an “increasing level of resolve among the average Bitcoin participant.”