Around 76% of the total circulating Bitcoin provide is currently illiquid in keeping with on-chain analytics from Glassnode. 


Bitcoin (BTC) markets are consolidating since the start of the year, however on-chain metrics are painting a a lot of positive image as a lot of of the asset is becoming illiquid. 

On-chain analytics supplier Glassnode has been delving into Bitcoin provide metrics to get a better view of the longer-term macro trends in its weekly report on Monday. 

The findings disclosed that though the asset has been trading sideways thus far this year, a lot of BTC has become illiquid. There has been an acceleration in illiquid provide growth, that currently contains over three quarters, or 76%, of the overall current provide. 

Glassnode defines illiquidity as once BTC is moved to a wallet with no history of paying. Liquid supply BTC, that makes up 24-karat gold of the overall, is in wallets that pay or trade regularly such as exchanges and hot wallets. 

“We can see that over the final months of 2021, even as prices corrected, there has been an acceleration of coins from liquid, into illiquid wallets.”

The figures recommend that a lot of Bitcoin is being transferred into storage, indicating a rise in hodling habits and accumulation. The decline in highly liquid provide additionally hints that there may not be a major sell-off or capitulation event at any time within the near future. 

BTC liquid and illiquid supply as a percent of the total. Source: Glassnode

The researchers all over that these conditions indicate “divergence between what seems to be constructive on-chain offer dynamics, compared to bearish-to-neutral value action.”

(MArtin Young, Cointelegraph, 2022)