The current accumulation patterns of the Bitcoin and Ethereum networks are very similar. A report by Glassnode indicates that both networks entered an accumulation phase in March.
The price of Bitcoin (BTC) and Ether (ETH) may rise significantly in the coming months. That is what the investors who continue to accumulate both cryptocurrencies seem to consider.
The latest report by Glassnode reveals that the number of coins three months old or less steadily declines. In other words, there have been increasingly few currency transfers in the short term. That suggests that people prefer to think about taking profits in the long run.
The report indicates that the two networks show very similar accumulation patterns at the moment. Concerning Bitcoin, more than 50% of the supply of coins is between three months and three years old. For their part, those who invest in Ethereum speak of 70% in this time range.
Those bullish trends in the coin supply of both assets started around March, Glassnode reported. That reflects strong demand for buying and holding throughout that bullish market.
The number of Bitcoin and Ether (ETH) addresses with balances above zero has also been increasing. The first cryptocurrency on the market is close to its all-time high, while the second has already exceeded its.
The Activity Falls as Investors Keep Saving
The authors of the report highlighted a divergence between the price and on-chain activity of Bitcoin and Ethereum. Besides, they said that the number of transactions processed daily had dropped considerably.
In that sense, the experts noted that that is historically abnormal for a large-scale bullish market. Additionally, they stated it is not uncommon for the dynamics before the rise and fall of supply.
That steep decline in the activity could be a bearish sign, but current accumulation dynamics suggest robust underlying demand.
Analysts added that such investor performance shows that the upward cycle of the market is still continuing. However, they recommend paying attention to the oldest coins. If users start spending said coins, it could be a signal that invalidates the current accumulation phase.
Experts have consistently reported that this is a phase of accumulating rather than spending cryptocurrencies. Many analysts and researchers have been reiterating this situation in recent weeks.
The Supply of Bitcoin Has Undergone Further Reduction
Renowned analyst Willy Woo takes a very bullish position on the Bitcoin environment. He considers that the supply of BTC has seen the most dramatic reduction during this phase. For that reason, he expects the price of the pioneering cryptocurrency to keep rising.
In a recent newsletter, Woo stated that this is the second major reaccumulation of this cycle, which will lead to a breakout to the upside. He believes that the supply and demand dynamics suggest a price of USD 60,000. Based on the supply shock model, Woo argues that holders have entered the long-term maximum accumulation zone.
While there is a consolidation of the price of Bitcoin below USD 50,000, this zone has remarkable stability. The analyst says that those areas tend to anticipate a significant price movement.
By Alexander Salazar
