Groundswell Building — Bitcoin HODL metrics update April 2022

Chart 1 — available supply by age band in Bitcoin’s history. Bullruns clearly show a reduction in older age bands as highly profitable older coins are moved to be sold.
Chart 2 highlights the survival of a UTXO through time. For example 13% of coins last transacted on July 2014 have not been spent to this day and are in the 10year+ age band.
Chart 3 — the survival rate of coins moving into the 6–12months age band and maturing into the 1–2 year age band provides a very strong signal on the state of the market with low rates signaling a bull run and high rates signaling strong HODLing in anticipation of higher prices.
Chart 4 — a cumulative weighted survival rate is a weighted sum of the survival rates of all age bands weighted by the amount of coins maturing. This gives an overall survival rate and indication of HODLing behavior.
Chart 5 — the HODL ratio generally runs inversely to price. While the HODL ratio doesn’t model demand, there is clear indication that high HODL rates induce a bull run by affecting a supply shock. We also know from on-chain entity data that price rises fuel more demand.
Chart 6 — The HODL forecast in Bitcoin’s history shows good correlation with price, especially the dips, but also the bull runs. As the forecast is fixed from 11 months out black swan events like covid don’t impact the hold forecast until 11 months later, in this case possibly dampening the early ’21 bull run by having pulled forward demand.
Chart 7 — The HODL forecast overestimates the actual HODL measured except during projected bear markets eg late 2018 and early ’22. The HODL ratio drops to meet increased demand.
Chart 8 — The Buy/HODL indicator highlights the delta between the forecasted HODL and actual. When the gap is small or even negative it has historically been a buying opportunity.
  1. The survival rate of the key 6–12month age band remains high and has been at historically high levels for over 4 months now. This contributes to a building supply shock.

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