Experienced cryptocurrency investors continue to accumulate Bitcoin (BTC) at the rate of 50,000 coins per month, equivalent to $1.35 billion, based on the recent onchain report by blockchain analytics company, Glassnode. This increasing demand happens while the extensive digital asset market remains remarkably inactive both onchain and across trading platforms.
Consistent Bitcoin Investors Hold Firm in Inactive Market
Despite the significant price swings of Bitcoin this year, the group of long-term investors or "hodlers" stands firm, according to the recent Glassnode report. The Hodler Net Position Change metric by Glassnode indicates that these investors, particularly those who have held coins for at least 155 days, are withdrawing over 50,000 BTC from exchanges every month. These numbers underscore the tightening supply and the unwillingness among experienced investors to transact under the current market conditions.
Analogy with Previous Bear Markets
Glassnode points out that the market has been experiencing low and shrinking liquidity, similar to the bear markets of 2014-15 and 2018-19, now stretching to 535 days. Both the value transferred onchain and the injection of new capital into the Bitcoin network have hit multi-year lows. Exchange activities also showcase widespread indifference among investors. The 30-day average for total exchange volume is currently hovering around $1.5 billion, a 75.5% slump from its peak of $6 billion in May 2021.
Market Detox from 2021-22 Cycle
According to Glassnode's researchers, "The volume of Profit and Loss realized by coins sent to Exchange Addresses has also undergone a complete detox from the 2021-22 cycle, with both measures hitting the lowest levels seen since 2020."
Spotting Intense Altseason Periods
To pinpoint periods of intense altcoin speculation, Glassnode introduced a model to evaluate risk-on and risk-off environments through the perspective of capital rotation. Despite altcoin prices' volatility, this model suggests that capital is not presently rotating from Bitcoin through Ethereum and stablecoins at escalating rates, a typical characteristic of "altseason mania."
Anticipating for the Next Bull Surge
In the midst of the wild fluctuations in altcoin prices, Glassnode proposes that these swings are more a result of the current low liquidity than a genuine risk-on sentiment. For now, hodlers are eagerly accumulating BTC, tightening supply in expectation of an upcoming bull surge. Furthermore, with the next reward halving only 196 days away, we are likely to experience an even more intense squeeze on supply.
What are your views on Glassnode's data concerning long-term Bitcoin investors and the identification of intense altseason periods? Share your thoughts and views on this subject below.
Frequently Asked Questions
What precious metals do you have that you can invest in for your retirement?
Understanding what you have now saved and where you are currently saving money is the first step in retirement planning. If you don't know how much you currently have saved, start by taking an inventory of everything you own. This includes stocks, bonds and mutual funds, as well as certificates of deposit (CDs), life policies, annuities and 401(k), plans, real estate investments and other assets, such precious metals. Add all these items together to calculate how much money you have for investment.
If you are between 59 and 59 1/2 years, you might consider opening a Roth IRA. While a Roth IRA does not allow you to deduct contributions from taxable income, a traditional IRA allows for that. However, you won't be able to take tax deductions for future earnings.
If you decide you need more money, you will likely need to open another investment account. Begin with a regular brokerage.
Do You Need to Open a Precious Metal IRA
It all depends on your investment goals and risk tolerance.
If you plan to use the money for retirement, you should open an account now.
Precious metals will appreciate over time. You also get diversification benefits.
Additionally, silver and gold prices tend to move in tandem. They are therefore a better option for investing in both assets.
If you're not planning on using your money for retirement or don't want to take any risks, you probably shouldn't invest in precious metal IRAs.
Are precious metal IRAs a wise investment?
It all depends on your willingness to take the risk of an IRA account losing its value. As long as your assets don't grow very rapidly, these are a good option. These may not be the best option if you are looking to save for retirement over many decades and invest in assets that will increase in value (e.g. gold). These investments can also be subject to fees that could reduce any gains.
Can I keep my gold IRA at work?
Investing in an online brokerage account is the best way to keep your money safe. You have all the investment options you'd get if you had a traditional broker. However, you don't require any licenses or qualifications. Plus, there are no fees for investing.
Many online brokers also offer tools that can help you manage your portfolio. To see the performance and trends of your investments, you can download charts from these brokers.
What are the fees for an IRA that holds gold?
The average annual fee for an individual retirement account (IRA) is $1,000. There are many types of IRAs available, including traditional, Roth, SEP and SIMPLE IRAs. Each type has its own set requirements and rules. For example, you may have to pay taxes on any earnings from your investments if they're not tax-deferred. The amount of time you intend to keep the money must be considered. If you plan to keep your money longer, you can save more money by opening a Traditional IRA instead of a Roth IRA.
A traditional IRA allows you to contribute up to $5,500 per year ($6,500 if you're 50 or older). A Roth IRA lets you contribute unlimited amounts each year. The difference between them is simple: With a traditional IRA, you can withdraw the money after you retire without paying taxes. On the other hand, you'll owe taxes on any withdrawals made from a Roth IRA.
What are the pros & con's of a golden IRA?
The gold IRA is a great way to diversify your portfolio, but you don't have access the traditional banking services. It allows you invest in precious metals like platinum, silver, and gold without any taxes, until they're withdrawn.
The downside is that withdrawing money early will pay ordinary income tax on the earnings. However, these funds are kept outside the country and cannot be seized by creditors if you default.
A gold IRA could be the best option for you if your goal is to have gold that you can own without worrying about taxes.
- Silver must be 99.9% pure • (forbes.com)
- The maximum yearly contribution to an individual's IRAs is currently $6,000 ($7,000 for those 50 years or older), or 100% of earned income, whichever is less. (monex.com)
- Depending on your financial situation, most experts recommend you invest no more than 5% to 10% of your retirement funds in precious metals. (forbes.com)
- The IRS also allows American Eagle coins, even though they do not meet gold's 99.5% purity standard. (forbes.com)
- Gold IRA – Add Sparkle to Your Retirement Nest Egg
- Understanding China's Evergrande Crisis – Forbes Advisor
How To Buy Gold For Your Gold IRA
A term that describes precious metals is gold, silver and palladium. It can be any element naturally occurring between atomic numbers 7 and 110 (excluding the helium). This is valuable due to its beauty and rarity. Precious metals include gold and silver. Precious Metals are often used for money, jewelry and industrial goods.
Gold's price fluctuates each day due to supply/demand. As investors seek safety from unstable economies, there has been an increase in demand for precious metals in the last decade. This has resulted in a substantial rise in the prices. However, the increasing cost of production has made some people concerned about investing in precious metals.
Because gold is rare and durable, it makes a good investment. The value of gold is never lost, which is unlike many other investments. You can also buy and sell gold, without having to pay taxes. There are two methods to invest gold. You can buy bars and gold coins, or invest into gold futures contracts.
Physical gold coins and bars provide immediate liquidity. They are easy to trade and keep. They aren't very effective in protecting against inflation. If you want to protect yourself from rising prices, consider purchasing gold bullion. Bullion is physical, or pure gold. Some billions come in one-ounce pieces, while others come in larger sizes like kilo bars. Bullion is often stored in vaults, which are safe from fire and theft.
Gold futures can be a great way to buy shares rather than actual gold. Futures allow you to speculate on how the price of gold might change. You can purchase gold futures to get exposure to the gold price, but not the actual commodity.
If I wanted to speculate about whether gold's price would rise or fall, I could buy a gold contract. My position at the expiration of the contract will be either “long-term” or “short-term.” A long contract is one in which I believe that the price of gold will rise. I'm willing now to pay someone else money, but I promise I'll get more money at the end. A short contract, on the other hand, means I believe the price of gold is going to drop. I'm willing now to accept the money in exchange for the promise of making less later.
I'll get the contract's specified amount of gold plus interest when it expires. This gives me exposure to the gold price, but I don't have to own it.
Precious metals can be a great investment because they are very hard to counterfeit. Paper currencies can be easily faked by printing new bills. Precious metals are not easy to counterfeit. Precious metals have remained stable over time because of this.
By: Jamie Redman
Title: Long-Term Bitcoin Investors Accumulate $1.35B Worth Every Month Amidst Inactive Altcoin Scenario
Sourced From: news.bitcoin.com/report-long-term-holders-gobble-up-1-35b-in-bitcoin-each-month-while-altcoin-mania-lies-dormant/
Published Date: Wed, 11 Oct 2023 18:00:56 +0000