Data show that recent bitcoin selling has been driven by short-term holders, and BitMEX has become a major slaughterhouse

Note: The original author is the team of Nate Maddrey and Coin Metrics. The following is the translation:

On March 12th, due to concerns about the COVID-19 epidemic, Bitcoin suffered its biggest one-day drop in 13 years, and most mainstream crypto assets were brutally washed.

BTC & S & P correlation coefficient hits record high

It is worth noting that the Pearson correlation coefficient between Bitcoin and the S & P 500 Index surged to a historical high of 0.52 on the 12th, compared with the previous high of 0.32. This shows that the relationship between the cryptocurrency market and the existing financial market is getting closer and closer, and its response to external events is stronger than ever.

(Note: The following pictures and data are from Coin Metrics)

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Over the past week, Bitcoin prices appear to have responded to several key events, including Trump's announcement of a 30-day travel ban between the United States and Europe, and the Federal Reserve's announcement of a cut in interest rates to 0.00% -0.25%.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Bitcoin selling seems to come mostly from short-term holders

The data on the chain shows that the recent price trend of Bitcoin may be mainly driven by short-term holders and relatively new holders.

Coin Metrics tracked the transfer of old coins on the market. On March 11, about 291,000 coins aged 30 days or more were transferred across the entire network, and only 4,131 BTC coins were older than one year. This shows that the vast majority of bitcoin trading activities on March 11 and March 12 came from short-term holders who held less than one year.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Data show that March 11th is the fourth largest peak of Bitcoin's 30-day window currency transfer in the past 8 years.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Despite the severe downturn in the market, long-term investors (hodler) do not seem to be worried. As shown in the figure below, on March 11th, the transfer amount of BTC with a currency age of more than one year was not particularly large.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

The destruction data of Yuantian also showed a similar picture. On March 11th and March 12th, the value of BTC's day-to-day destruction did not increase significantly, which indicates that long-term holders did not conduct large-scale transactions before the recent price changes.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

In addition, BTC's SOPR indicator fell to 0.843 on March 12, which was the lowest value since February 2012. In essence, SOPR is a network-wide profit and loss indicator. It is a ratio of the sold price (the price of BTC when a new output is created) to the paid price (the price of BTC when a transaction input is created). Therefore, an indicator below 1 indicates that investors are selling at a loss .

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

BTC MVRV indicator is lower than 1, which is the fourth time in history

The market value of BTC is less than 1.0 for the fourth time in history (MVRV). The MVRV indicator refers to the ratio of the market value of cryptocurrencies to its realized cap. The Realized Cap (Realized Cap) can be considered as an approximation of the total cost invested by the market investor for the asset.

And the MVRV indicator is higher than 1, which may indicate that the average market value of speculators is higher than the average market value of holders (hodler). Conversely, the MVRV indicator is lower than 1, which may mean that holders (hodler ) Has a higher market valuation than current speculators. In addition, when the MVRV indicator fluctuates below the level of 1, holders will be tested because it means that they may not be able to immediately sell their holdings in a profitable manner.

On the day of March 12, the BTC MVRV indicator fell by 0.5, which was the largest one-day drop since December 2013. From another perspective, the period when the MVRV was below 1 is often the best period to buy BTC at a low price.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

The sharp drop in MVRV was mainly caused by the market value of BTC falling by more than 30% since March 9, and its actualized market cap (Realized cap) has only dropped by about 3%. This data once again shows that most BTC Old coins have not been sold by holders.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

The realized cap of other mainstream crypto assets have all fallen sharply. Among them, Ethereum (ETH) and Tezos (XTZ) have been hit particularly hard. Since March 9, the Realized Cap of the two have fallen by 6.09% and 9.12%, respectively, while Maker (MKR) has become After the recent biggest loser, MakerDAO was forced to take a number of emergency measures after the ETH price fell sharply, and its Realized Cap fell by 21%.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Market funds flowing into exchanges and stablecoins

Unlike most of the plummeting cryptocurrency assets, the market value of many stablecoins has clearly increased recently. This could mean that investors are swapping their assets for "cash", or at least cryptocurrency equivalents.

For example, during the period from March 10th to March 15th, the market value of Tether (USDT_ETH) issued on Ethereum increased by approximately USD 300 million. The USDC used on Coinbase and other platforms has also seen tremendous growth, with its market value increasing by nearly $ 150 million in recent days.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

In addition, on March 13, more than 160,000 BTC flowed into mainstream cryptocurrency exchanges across the entire network, including Binance, Bitfinex, BitMEX, Bitstamp, Bittrex, Gemini, Huobi, Kraken, and Poloniex. This is since November 2017. The largest single-day inflows since the 13th.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Similarly, on March 13, more than 171 thousand BTC flowed out of the exchange, which is also the largest single-day BTC flow since November 2017.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

In addition, the data shows that BitMEX is still the main battlefield of contract transactions. On March 12 and 13, the BTC flowing into the exchange was 43,200 and 37,500, respectively.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Both Binance and Huobi have more BTC daily outflows than BitMEX.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

Due to the recent market impact, the amount of BTC held by BitMEX soared to a record high. On March 13, the amount of BTC held by the exchange reached a peak of 315,700 BTC.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

During the sell-off period, the spread between BitMEX and Coinbase was about 16%. This may be due to the forced liquidation of perpetual leverage, which magnified price volatility. After the phenomenon of "plugging the network cable" in BitMEX, the Bitcoin market experienced a rapid rebound. BitMEX recently released an explanation detailing two DDoS attacks.

数据显示:近期比特币抛售是由短期持有者推动,BitMEX成主要屠宰场

in conclusion

After a crazy week of bitcoin, preliminary data analysis after the fact shows that the sell-off seems to be driven by short-term holders, while long-term holders remain unmoved, at least for the moment. As of now, BTC's MVRV ratio is still below 1, which seems to be entering an attractive price range.

However, the market situation has not stabilized and it is unclear what will happen in the future. We will closely monitor related events in this unprecedented period and will provide the latest situation and analysis in the coming weeks.