Bitcoin (BTC) is up 4.63% in the past 24 hours to hit $ 43,893 during intraday trading. after falling briefly below $ 40,000 on September 22nd, a fate not seen since August 5th.
The decline in the crypto market price resulted in the open interest of BTC’s perpetual swaps for the first time since Jan. accepted from data analytics company IntoTheBlock.
Open interest usually rises with a rise in price, which shows that the two are highly correlated. For example, Bitcoin’s open interest in perpetual swaps recently passed the $ 16 billion mark, and at that time the price was hovering around the $ 50,000 mark.
Meanwhile, Bitcoin’s 30-day average returns recently plummeted at least 6%, hitting an 8-week low.
According to reports, this drop in prices was triggered by the financial crisis affecting China Evergrande, a leading Asian property developer. Hence, the biggest liquidity challenge impacted the crypto market.
The BTC supply is constantly switching to old hands
To to the on-chain analyst Rafael Schultze-Kraft:
“The Bitcoin offer has steadily matured into old hands. From the high of $ 65,000, nearly 2 million BTC has transitioned from short-term to long-term owners. “
Hence, it shows that while short-term BTC holders have been selling, their long-term counterparts have bought.
Dilution-safe reflected these feelings. The crypto analytics company explained:
“During the market downturn over the past few months, the amount of older coins moving in the chain is gradually decreasing, suggesting that the larger and more experienced Bitcoin holders are less inclined to sell, mostly waiting to see what’s next . “
Additionally, Bitcoin whales have been on a buying spree as they recently added 31,848 BTC to their holdings.
On the flip side, the Bitcoin funding rate recently turned negative as the leading cryptocurrency recently posted a 10% daily loss as over-indebtedness factors dominated. In fact, BTC experienced a significant pullback that resulted in a loss of $ 10,000 as Bitcoin longs were overly leveraged.
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