According to Glassnode statistics, Bitcoin balances on major exchanges have fallen to a three-year low. This could mean that people prefer to hold their bitcoins for the long term rather than choosing to sell them in the near term.
Currently, with a 24-hour gain of about 5%, Bitcoin has reached the $43,000 mark, and the cryptocurrency has been range-bound for the past three months.
Some market players believe that Bitcoin’s speculative properties have dried up as the Federal Reserve begins to raise interest rates. On the other hand, with Bitcoin falling below the important breakeven point of $47,000, there is a good chance that Bitcoin will be range-bound for an extended period of time – as short-term traders see a rebound and choose to sell.
Aoifinn Devitt, chief investment officer at Moneta, said the cryptocurrency has only been around for more than a decade, so there is little historical data available to measure its performance in an environment of persistent inflation.