The digital asset space is currently going long-term as most digital asset holders are unwilling to sell their holdings. New statistics from crypto-based data analytics company shows that even new holders that bought early this year did not sell-off their Bitcoin even with the mid-January price correction.
Most of the investors who did not sell during that crash were able to benefit from the Tesla price surge, and more price gains as Bitcoin keeps growing at a steady rate. The digital asset space is becoming stronger as people held their crypto even when the price drops worsened linked to Bitcoin’s usual behavior of having large surges especially after a long bearish period.
Crypto holders are unwilling to sell
The newly-found strength of the holders could be based on some new reasons, and also because institutional buyers are taking the industry by storm. Despite the market being volatile, the holders have not lost their determination to go long-term. Glassnode believe that the other reason why buyers have not sold their crypto could be because of the Spent Output Profit Ratio (SOPR).
The firm calculates the SOPR by dividing the selling price by the price it was purchased. If after the division, the value is up to 1, then the sellers are making profits, which is unusual for a bearish market where price losses are inevitable.
Also read:In bearish market, many people get scared and sell-off their holdings at a cheaper price to prevent more losses. But the statistics is showing that people are actually making profit meaning that they didn’t sell their holdings during the first major price correction this year.
Last month, where Bitcoin saw some slight falls, most of the SOPR hardly goes below 1 meaning that investors are getting benefits for going long. The data company through statistics from checking the 60-day SOPR were able to understand that most holders have not made losses even as Bitcoin dips, showing that they bought the asset in January, and have not sold since then.
Buyers are hodling for the long-term
Many of the new buyers are institutions and whales, meaning that they could be holding the digital asset for a very long-time to assure more attractive gains. Since the asset is very volatile, it’s likely that once it the bull market emerge, the asset will skyrocket and would add to more profits for them. Many people joined the crypto industry because of two reasons mainly.
First, the pandemic affected many assets significantly, and it made investors seek an alternative to assure more attractive gains. The other would be because Bitcoin acts as a value store that works against excess money printing that happens in numerous countries.
MicroStrategy is one of the biggest institutional investors because it has a very large Bitcoin holding and has influenced other big brands like Tesla to follow suit. The firm currently has around $4.4 billion worth of Bitcoin, and only spent half of that money being the asset. Recently, the business intelligence company snatched up another $10 million worth of Bitcoin to add to its portfolio.
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