Bitcoin Sees Increased Selling From 'Old Hands' As It Trades Near $50,000 Level

Bitcoin BTC/USD is seeing increased selling by old coin holders as it hovers around the psychologically important $50,000 mark, as per Glassnode.

What Happened: Glassnode used the Spent Output Age Bands metric to investigate the cohorts of the market spending BTC. “This week has seen a noticeable uptick in older coin ages, particularly those older than  6-months,” the on-chain analytics firm said in a report, referring the week ended August 22.

Seven-Day Moving Media Chart of Spent Output Age Bands (Courtesy: Glassnode)

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As per Glassnode, in the last year, older coins came into play during distribution in a bull market when old coin holders took profits and distribution in major sell-offs as these holders de-risked during major corrections.

A similar observation was made when analyzing outputs between 6 months and 5 years — a period of time that captures old hands, both traders and investors.

Spent Outputs Aged 6M and 5Y, Courtesy: Glassnode

Coming back to last week, a sharp uptick was seen in outputs which suggest some coins are taking exit liquidity.

Why It Matters: Glassnode said that relative to previous cycles old coin owners tend to be more active traders in recent years.

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“In the 2011 and 2013 cycles, older coins typically only came back to life around macro tops and bottoms, where as today it is more common around mid-cycle corrections and rallies,” Glassnode noted.

This, as per the on-chain analysis firm, is an indicator of “market maturity” and "[financialization] of Bitcoin” over time.

Bitcoin crossed the $50,000 level on Monday, but analysts are cautious as the apex coin faces resistance.

Along with profit-taking by old coins, the cryptocurrency also has to contend with “rare confluence of technical obstacles,” as per a Bloomberg report.

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