On-chain data shows that Bitcoin addresses with zero sales histories participated in a big accumulation before this recovery run started.
Bitcoin Inflows To Accumulation Addresses Sharply Spiked Recently
As explained by an analyst in a CryptoQuant Quicktake post, the accumulation addresses on the Bitcoin network have shown some significant inflow activity recently.
The “accumulation addresses” here refer to the Bitcoin wallets that have never made outgoing transactions on the blockchain. In other words, the accumulation addresses are basically the HODLers of the network.
Not every address with zero history of selling is included in this cohort, though, as there are some other requirements. The address must have at least two incoming transactions, the last of which must have occurred within the past seven years.
These exist because a wallet with only one transfer wouldn’t set a pattern one way or the other, and addresses that have been inactive for more than seven years are more likely to have reached old age by being lost rather than through HODLing.
Only the addresses holding greater than 10 BTC are counted under the accumulation addresses. Naturally, exchange—and miner-related wallets are excluded from this cohort, as they represent the perennial sell side of the market, which is on the opposite end of the spectrum from these HODLers.
Now, here is a chart that shows the trend in the Bitcoin inflows going into the combined balance of this group over the past year or so:
The value of the indicator appears to have been quite high in recent days | Source: CryptoQuant
As displayed in the above graph, these accumulation addresses saw extremely large inflows on the 15th of this month. More particularly, these HODLers received 17,800 BTC to their balance with this spike.
At the time of these inflows, the cryptocurrency price was around $61,600, so the purchases would have cost these investors almost $1.1 billion.
Interestingly, the asset’s price started on a recovery run soon after this buying spree, culminating in the asset surpassing the $71,000 mark earlier in the past day.
The accumulation from these HODLers might have naturally been a factor behind the rally, but it most likely wasn’t the sole reason. Rather, it would appear that these are potentially smart-money investors who anticipated the rally, so they bought in at the lows.
The chart shows that the indicator registered two extreme spikes earlier in the year as well. Following both of these, the cryptocurrency witnessed some bullish price action.
The accumulation has certainly paid off for these Bitcoin HODLers this time, as the stack that they bought is now worth more than $1.24 billion.
BTC Price
At the time of writing, Bitcoin is trading at around $69,600, up 13% over the past week.
Looks like the price of the coin has seen a pullback since its high earlier in the day | Source: BTCUSD on TradingView