Long-standing cryptocurrency investors are persistently purchasing Bitcoin (BTC), amassing around 50,000 coins per month, valued at a staggering $1.35 billion. This data is drawn from the most recent onchain report by Glassnode, a renowned blockchain analytics firm. These purchases are causing a tightening in Bitcoin's supply as the larger digital asset market remains largely inactive across exchanges and within the onchain space.
Enduring Bitcoin Holders Maintain Their Position in a Static Market
Despite the significant price volatility Bitcoin has seen over this year, the group of long-term holders, or 'hodlers', remain undeterred. The latest report by Glassnode reveals this, showcasing that investors holding coins for a minimum of 155 days continue to withdraw more than 50,000 BTC from exchanges on a monthly basis. This demonstrates both the tightening supply and the unwillingness of seasoned investors to transact under the existing market conditions.
According to Glassnode, the market has been experiencing a period of decreasing liquidity, similar to the bear markets of 2014-15 and 2018-19, which has now lasted for 535 days. Both the value transferred in the onchain space and the influx of new capital into the Bitcoin network have hit multi-year lows. The lack of activity on exchanges also reflects a general disinterest among investors. The total exchange volume's 30-day average currently hovers around $1.5 billion, a significant 75.5% decline from its peak of $6 billion in May 2021.
Recognizing Active Altcoin Trading Periods
To pinpoint times of extreme altcoin speculation, Glassnode has devised a model that assesses risk-on and risk-off environments by examining capital rotation. This model reveals that, despite altcoin price volatility, capital is not presently shifting from Bitcoin to Ethereum and stablecoins at an escalating rate, which is generally a characteristic of active altcoin trading.
The model operates by identifying a positive and growing 30-day change in the Ethereum Realized Cap and Total Stablecoin Supply. Glassnode's report explains that this model emulates the cascading effect of capital moving from larger caps to smaller caps.
Despite the erratic price fluctuations of altcoins, Glassnode posits that these swings are more reflective of the current low liquidity than an actual risk-on sentiment. For now, hodlers are eagerly acquiring BTC, further tightening supply in anticipation of an upcoming bull surge. With the next reward halving just 196 days away, an even more significant tightening of supply is expected.
Your Thoughts on Bitcoin Accumulation and Altcoin Activity
We'd love to hear your thoughts and opinions on Glassnode's data regarding long-term Bitcoin holders and the recognition of active altcoin trading periods. Feel free to share your thoughts on this topic in the comments section below.
Frequently Asked Questions
What Precious Metals Can You Invest in for Retirement?
These precious metals are among the most attractive investments. Both are easy to sell and can be bought easily. These are great options to diversify your portfolio.
Gold: The oldest form of currency known to man is gold. It's stable and safe. Because of this, it is considered a great way of preserving wealth during times when there are uncertainties.
Silver: Silver is a popular investment choice. It is an excellent choice for investors who wish to avoid volatility. Silver is more volatile than gold. It tends to rise rather than fall.
Platinium: Platinum is another form of precious metal that's becoming increasingly popular. It is very durable and resistant against corrosion, much like silver and gold. It's however much more costly than any of its counterparts.
Rhodium – Rhodium is used to make catalytic conversions. It is also used for jewelry making. It is relatively affordable when compared to other types.
Palladium (or Palladium): Palladium can be compared to platinum, but is much more common. It is also cheaper. This is why it has become a favourite among investors looking for precious metals.
What does gold do as an investment?
Supply and demand determine the gold price. Interest rates also have an impact on the price of gold.
Due to the limited supply of gold, prices for gold are highly volatile. Physical gold is not always in stock.
Do You Need to Open a Precious Metal IRA
You should be aware that precious metals cannot be covered by insurance. You cannot recover any money you have invested. This includes any loss of investments from theft, fire, flood or other circumstances.
This type of loss can be avoided by investing in physical silver and gold coins. These coins have been around for thousands and represent a real asset that can never be lost. These items are worth more today than they were when first produced.
Consider a reputable business that offers low rates and good products when opening an IRA. Consider using a third-party custody company to keep your assets safe and allow you to access them at any time.
If you decide to open an account, remember that you won't see any returns until after you retire. Keep your eyes open for the future.
How much should your IRA include precious metals
When investing in precious metals, the most important thing to know is that they aren't just for wealthy people. You don’t need to have a lot of money to invest. There are many ways that you can make money with gold and silver investments, even if you don't have much money.
You could also consider buying physical coins like bullion bars, rounds or bullion bars. Stocks in companies that produce precious materials could be purchased. Your retirement plan provider may offer an IRA rollingover program.
You'll still get the benefit of precious metals no matter which country you live in. They are not stocks but offer long-term growth.
Their prices rise with time, which is a different to traditional investments. You'll probably make more money if your investment is sold down the line than traditional investments.
What are the pros and disadvantages of a gold IRA
The main advantage of an Individual Retirement Account (IRA) over a regular savings account is that you don't have to pay taxes on any interest earned. This makes an IRA a great choice for people who are looking to save money but don’t want to pay any tax on the interest earned. But, this type of investment comes with its own set of disadvantages.
If you withdraw too many funds from your IRA at once, you may lose all your accumulated assets. You might also not be able to withdraw from your IRA until the IRS deems you to be 59 1/2. If you do withdraw funds, you'll need to pay a penalty.
Another disadvantage is that you must pay fees to manage your IRA. Most banks charge 0.5% to 2.0% per annum. Other providers charge monthly management charges ranging anywhere from $10 to $50.
Insurance will be required if you would like to keep your cash out of banks. A majority of insurance companies require that you possess a minimum amount gold to be eligible for a claim. You might be required to buy insurance that covers losses up to $500,000.
If you are considering a Gold IRA, you need to first decide how much of it you would like to use. Some providers limit the number of ounces of gold that you can own. Others let you pick your weight.
You'll also need to decide whether to buy physical gold or futures contracts. Gold futures contracts are more expensive than physical gold. However, futures contracts give you flexibility when buying gold. They allow you to set up a contract with a specific expiration date.
You also need to decide the type and level of insurance coverage you want. The standard policy does not include theft protection or loss caused by fire, flood, earthquake. It does include coverage for damage due to natural disasters. If you live near a high-risk region, you might want to consider additional coverage.
In addition to insurance, you'll need to consider the cost of storing your gold. Insurance won't cover storage costs. In addition, most banks charge around $25-$40 per month for safekeeping.
If you decide to open a gold IRA, you must first contact a qualified custodian. A custodian maintains track of all your investments and ensures you are in compliance with federal regulations. Custodians don't have the right to sell assets. Instead, they must keep your assets for as long you request.
After you've determined which type of IRA is best for you, fill out the paperwork indicating your goals. You should also include information about your desired investments, such as stocks or bonds, mutual funds, real estate, and mutual funds. Your monthly investment goal should be stated.
After filling out the forms, you'll need to send them to your chosen provider along with a check for a small deposit. The company will review your application and send you a confirmation letter.
When opening a gold IRA, you should consider using a financial planner. Financial planners are experts at investing and can help you determine which type of IRA is best for you. You can also reduce your insurance costs by working with them to find lower-cost alternatives.
How do I Withdraw from an IRA with Precious Metals?
You first need to decide if you want to withdraw money from an IRA account. Make sure you have enough cash in your account to cover any fees, penalties, or charges that may be associated with withdrawing money from an IRA.
An IRA is not the best option if you don't mind paying a penalty for early withdrawal. Instead, open a taxable brokerage. If you decide to go with this option, you will need to take into account the taxes due on the amount you withdraw.
Next, you'll need to figure out how much money you will take out of your IRA. This calculation is dependent on several factors like your age when you take the money out, how long you have had the account, and whether or not your plan to continue contributing.
Once you determine the percentage of your total saved money you want to convert into cash, then you need to choose which type IRA you will use. While traditional IRAs are tax-free, Roth IRAs can be withdrawn at any time after you reach 59 1/2. However, Roth IRAs will charge income taxes upfront and allow you to access your earnings later without additional taxes.
Once these calculations have been completed you will need to open an account with a brokerage. Many brokers offer signup bonuses or other promotions to encourage people to open accounts. It is better to open an account with a debit than a creditcard in order to avoid any unnecessary fees.
When it comes time to withdraw your precious metal IRA funds, you will need a safe location where you can keep your coins. Some storage facilities will accept bullion bars, others require you to buy individual coins. Either way, you'll need to weigh the pros and cons of each before choosing one.
Bullion bars are easier to store than individual coins. But, each coin must be counted separately. However, you can easily track the value of individual coins by storing them in separate containers.
Some prefer to keep their money in a vault. Others prefer to store their coins in a vault. Whatever method you choose to store your bullion, you should ensure it is safe and secure so you can enjoy its many benefits for many years.
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- 7 U.S. Code SS7 – Designation board of trade as contract marketplaces
- 26 U.S. Code SS 408 – Individual retirement funds
The growing trend of gold IRAs
As investors seek to diversify their portfolios while protecting themselves from inflation, the trend towards gold IRAs is on the rise.
Owners of the gold IRA can use it to invest in physical bars and bullion gold. It can be used for tax-free growth and provides an alternative investment option for those concerned about stocks and bonds.
An investor can use a gold IRA to manage their assets and not worry about market volatility. Investors can use the gold IRA for protection against inflation and potential problems.
Investors also enjoy the benefits of owning physical gold, which includes its unique properties such as durability, portability, and divisibility.
In addition, the gold IRA offers several other advantages, including the ability to quickly transfer ownership of the gold to heirs and the fact that the IRS does not consider gold a currency or a commodity.
Investors looking for financial security are increasingly turning to the gold IRA.
By: Jamie Redman
Title: Long-Term Investors Accumulate Bitcoin Amid Stagnant Altcoin Activity
Sourced From: news.bitcoin.com/report-long-term-holders-gobble-up-1-35b-in-bitcoin-each-month-while-altcoin-mania-lies-dormant/
Published Date: Wed, 11 Oct 2023 18:00:56 +0000