The cryptocurrency market comprises thousands of crypto tokens. Yet, Bitcoin remains to be the leader of the growing industry. It is the most valued crypto token and attracts a large chunk of investors to the digital asset industry. However, analysts and experts like Glassnode evaluate the performance of Bitcoin. These analyses and insights carry immense importance for the crypto community, as it predicts the future trends and patterns of the market.
Glassnode has released its latest on-chain report that is indicating that a large portion of Bitcoin supply is illiquid. Considering that Bitcoin is undergoing a bearish spell in the market, and the volatility is on a rise, this revelation carries significance for the performance of BTC. This illiquid BTC supply suggests that a large number of Bitcoin is sitting in wallets with no such history of spending.
Glassnode records a remarkable growth in BTC’s illiquid supply
According to the latest report, the supply ratio of illiquid bitcoin has grown to almost 3.2x. These figures are greater than the combined Liquid and High Liquid supply. Illiquid supply generally suggests that long-term coin holders are active. These types of holders are always critical for market stability and long-term growth. As Bitcoin is struggling in the market lately, this can be a propelling factor for its growth.
The #Bitcoin Illiquid Supply Shock Ratio, first developed by @WClementeIII, has ticked significantly higher this week.
Illiquid $BTC supply represents coins held in wallets with little to no history of spending. It is now 3.2x larger than Liquid and Highly Liquid supply combined pic.twitter.com/N0xejizRDE
— glassnode (@glassnode) March 13, 2022
The liquid supply of Bitcoin has decreased majorly in the last few days. It is estimated that a total of almost 54,000 Bitcoin were removed from different crypto exchanges. This shows that the liquid supply is decreasing and the illiquid supply of Bitcoin is increasing sharply. Consequently, lesser coins are running in the market to meet the demands.
The report from Glassnode might suggest that a bull run for Bitcoin is on the way, but the market condition of Bitcoin is not that promising. A major reason for the phenomenon is that there is a lack of demand for Bitcoin among consumers. Due to the unstable nature of the market, investors are not willing to put in more capital and hold their assets for longer periods of time.
The lack of BTC demand is primarily the reason that Bitcoin is showing no correlation with the on-chain report of Glassnode. However, this is a concerning factor for the crypto community. Bitcoin is currently trading below the $39,000 mark. Despite spells of bull runs, BTC has failed to cross the $45,000 mark successfully. The next few days are crucial to determine the performance pattern of Bitcoin.
