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Amount of ‘HODLed’ Bitcoin hits a 5-year high amid heavy market volatility

Amount of ‘HODLed’ Bitcoin hits a 5-year high amid heavy market volatility

Investors are adopting different strategies to manage the ongoing Bitcoin (BTC) price correction amid expectations that the asset will rally again in the future. In this case, most Bitcoin investors seem to be adopting the ‘HODL’ investment strategy.

In particular, as of September 21, the amount of Bitcoin HODLed hit a five-year record high at 7,495,059.588 BTC, worth approximately $143.74 billion. The last record five-year-high was registered on October 19, 2020, according to Glassnode data

Amount of BTC HODLed chart. Source: Glassnode

It is worth pointing out that the amount under HOLD sometimes entails Bitcoin in addresses whose owners have lost their access keys. Such Bitcoin is classified under lost coins. 

Implication of more Bitcoin in HODL

Notably, the amount in HODL partly reflects the market’s current state, characterized by high volatility. In this case, increased addresses holding Bitcoin points to a negative outlook for the market since investors are not eager to sell their coins. 

Furthermore, the holding will likely result in fewer Bitcoins circulating with liquidity impacted while limiting the chances of whales dumping in the market and influencing prices. 

As more investors shy away from selling their Bitcoin, the flagship cryptocurrency is struggling to avoid further correction below the $20,000 level. In this case, investors who believe in cryptocurrencies for the long term tend to hold onto their assets in anticipation of a market rally. 

Additionally, the depressed Bitcoin prices have offered an opportunity for investors to accumulate the asset cheaply and HODL while anticipating a future rally. 

Bitcoin likely to rally again

Furthermore, several analysts have maintained that the current market correction is temporary and forms part of the general Bitcoin growth trajectory.

For instance, senior commodity strategist at Bloomberg Intelligence Mike McGlone has acknowledged that the current Bitcoin price is selling at an extreme discount while noting that the asset will rally toward $100,000. 

Interestingly, if a majority of holders are awaiting the price to rally, the amount in HODL might increase, considering that there are projections of Bitcoin recording increased losses. 

Notably, with the Federal Reserve interest rate hikes, some analysts like chief market strategist, Gareth Soloway, stated that Bitcoin might drop further to about $12,000 before rallying again. 

In the meantime, Bitcoin has recorded minor losses of about 1% in the last 24 hours, trading at $19,130 by press time. 

Disclaimer:The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

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