- BTC Conviction is at an all-time high as long-term investors continue to add to their BTC stack unfazed by recent news and fallout according to data from Glassnode.
- The crypto has been declared dead on several occasions as fear and uncertainty are at an all-time high in the crypto industry.
- Although low conviction holders may be gone, sellers may still be there due to miner capitulation, taxes or inflation fears.
We have witnessed one of the most intense months in the crypto industry, with the fallout from FTX and other key players following such as Genesis, Voyager and BlockFi. Fear, uncertainty and doubt are at high levels in the media as Bitcoin is once again declared dead and the price of BTC has fallen to lows as low as $15,700.
“Crypto Is Now Dead: FTX, a Cryptocurrency Exchange, Collapsed Last Week, Proving a Lot of Nice Guys Horribly Wrong.” Tweets like this were all over social media when one of the biggest crypto exchanges, FTX, collapsed, taking many top players with them.
But amidst all this uncertainty, long-term bitcoin holders are undeterred, and in fact, the trend is such that they are currently increasing their long-term bitcoin holdings.
According to the GlassNodes chart, Bitcoin Hold Waves, this month of November marked an all-time high for long-term BTC holders, who now make up a 66% percentage on the chart. Long-term holders, from 3 years to 10 years, have held up at an unprecedented rate as the percentage of their holdings continues to rise.
The fallout from FTX has not moved BTC markets as much as expected, and this could be because low-conviction holders are already selling off and exiting the crypto industry. It remains to be confirmed whether this is the bottom of the markets; however, it seems that the “bad news” does not necessarily affect the price of BTC as dramatically as before. This could be because there are currently no low conviction sellers in the market.
That’s not to say that sellers won’t be there in a new fallout due to other factors like miner capitulation, taxes, and inflation.
Should Bitcoin miners capitulate?
According to CryptoQuant analyst Kripto Mevsimi, a new miners’ capitulation is likely to reappear. Mevsimi published his latest capitulation analysis on June 6, 2022, when the price of BTC was $31,500 and within 1-2 days the price became $18,000. According to him, the same pattern is now forming on the hash tape metric.
“So right now the difficulty of bitcoin is really high for miners, which means; costs are rising and doing business in this type of environment becomes more difficult,”
“That’s why the miners don’t work in full. If they have efficient next-gen mining machines, they turn them on, but that’s it. Inflation is high and people are feeling the effect of the cost of living, the price of bitcoin is decreasing, the cost and difficulty of mining are increasing. Challenging environment for miners. wrote Kripto Mevsimi in his latest blog post.
Kripto Mevsimi confirms that a change in mining difficulty could potentially improve the situation.
According to data from BTC.com, the mining difficulty is expected to drop to 7.08% at the time of writing.