Bitcoin (BTC) Capital Inflow Cooling Down, Expect Volatility, Glassnode Report Says

Bitcoin ETF euphoria completely vanished, on-chain metrics say

As net capital inflow into Bitcoin (BTC) loses traction, a degree of equilibrium has been reached between investors taking profit and loss, the Glassnode team says in its latest "The Week On-Chain" report. The last days of August look particularly apathetic in this regard: 89% of days experience a capital inflow larger than today.

Also, an insightful indicator of the MVRV Ratio suggests that investor profitability has essentially reset to equilibrium position and that the excitement and exuberance after the BTC ETF launch in the U.S. this January are not there anymore.

The Sell-Side Risk Ratio indicator also proves the "equilibrium" theory: the majority of coins is moved near its original acquisition price.

All of these metrics hint at volatility spikes coming for the largest cryptocurrency, researchers stressed:

As of press time, Bitcoin (BTC) is trying to protect $61,500 level after being brutally rejected at $65,000 yesterday. However, only $29 million in positions have been erased in the last 24 hours, almost all longs.

Long-term holders not selling, even at loss

Selling pressure on Bitcoin (BTC) right now is mostly driven by short-term holders, while "HODLers" are maintaining their confidence, Glassnode research reveals.

Q2-Q3, 2024, were painful for newcomers. After setting the ATH in March, the confidence of new investors was tested by choppy sideways price action for several months. During this process, a significant volume of the Bitcoin supply has remained tightly held and is within the three-month to six-month age band.