As Bitcoin is regaining significant upward strength, a notable trend has been spotted among long-term holders as indicated by a huge drop in the average age of wallets holding BTC. The trend demonstrates shifting market dynamics, prompting the modification of positions by retail and institutional players in anticipation of future price fluctuations.

A Persistent Drop In Average BTC Holdings

A recent report from Santiment, a market intelligence and on-chain data platform, reveals that the average age of Bitcoin stored in wallets has sharply plummeted, reflecting a rise in activity among long-term holders. Data from Bitcoin’s crucial Mean Dollar Invested Age metric shows that the average age of BTC wallets has been declining since last year.

Specifically, a drop in this metric implies that more coins have started to return to the main circulation from older wallets, offering retail investors the chance to transfer BTC among each other. Meanwhile, a rise in the indicator suggests that coins are becoming increasingly stagnant, which could influence market dynamic,s as seen between May 2021 and October 2023.

During the time frame, Santiment pointed out that Bitcoin’s average age reached a peak within 637 days at the end of the market cycle. This rise ultimately triggered unpredictable market conditions, leading to many significant downturns.

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Author: Godspower Owie