The number of Bitcoin (BTC) network wallets containing a balance above zero has decreased by 311,000 in the last 10 days.
The drop was noticed by the on-chain analysis and data provider Santiment, this Thursday (21).
Despite indicating that a considerable number of users decided to get rid of their coins, or lost them in liquidated operations, the decline can be seen as an optimistic sign for price movement.
What is the correlation between Bitcoin portfolios and its price?
As highlighted in the analysis, BTC historically corresponds with new jumps when the number of addresses containing units of the cryptocurrency drops.
Between September 23rd and October 23rd, the number of wallets with a balance above zero decreased by 1.1 million. On the other hand, BTC rose 28% in this period. In the period between January 21st and February 13th, the cryptocurrency soared 24% while 757 thousand addresses were liquidated.
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“For a beginning trader, it may seem worrying to have fewer active participants overall. However, historically this statistic has reflected moments of FUD in the market, indicating that small $BTC wallets are typically capitulating as large wallets collect their coins.“, https://twitter.com/santimentfeed/status/1770675644030169307 to Santiment.
Bitcoin Movement
The drop in the number of addresses holding Bitcoin appears to already be having an effect on the price. Currently, the cryptocurrency accumulates a daily appreciation of 5% – its best performance of the week.
Interestingly, the jump comes as BTC spot exchange-traded funds (ETFs) continue to see a considerable outflow of capital, showing that bulls remain in control of the trend.
Trading at US$66,540 at the close of the article, Bitcoin is just 10% away from recording a new price history. However, its future remains uncertain as the halving approaches.
Read more: Bitcoin reaches US$100,000 before halving? We asked experts
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