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On-chain analytics firm Glassnode has detailed which cohorts of Bitcoin it has accumulated and which have distributed over the past year.
Bitcoin Whale Distributes Coins Equivalent To 60% Mine Supply In Last 12 Months
According to data from Glass nodes, whales, miners, and exchange outflows were the main sources of distribution in the past year. The relevant indicator here is the “annual uptake rate,” which measures the annual change in Bitcoin balances of various cohorts in the market and compares it to the number of coins issued during this period.
“Coins issued” refers to the total amount that BTC miners receive in block rewards for mining a block. These new coins being produced have to go somewhere, and that is what the annual uptake rate metric tries to describe to describe the flow of BTC supply.
The groups Glassnode considers are shrimp (investors holding less than 1 BTC), crabs (between 1 and 10 BTC), whales (over 1,000 BTC), and miners. In addition, the company has also included data for “exchange outflows”, which measure the total amount of coins withdrawn from the wallets of all centralized exchanges.
Now, firstly, below is a chart showing which groups of investors absorb the positive amount from the annual coin issuance:
The value of the metrics seem to have been quite high in recent weeks | Source: Glassnode on Twitter
As shown in the chart above, the annual absorption rate of Bitcoin from shrimp is 107% at the moment, meaning that this group of investors added 107% of the total number of coins issued on the network to their holdings over the last year.
The indicator value is even higher for crabs at around 120%. From the chart, it can be seen that the metric has observed very rapid gains in recent months, indicating that a lot of accumulation occurred in the lows following the FTX collapse.
Since the amount added by this cohort is higher than what the network has put out in the last year, it seems reasonable to assume that some group must have distributed or sold their coins to make up the difference. The chart below shows which groups have shown distributional behavior over the past year.
Looks like these metrics have been deeply negative recently | Source: Glassnode on Twitter
It appears that the whale’s annual absorption rate is 60% underwater, indicating that holders of these giants have dumped the coin equivalent of 60% of the supply removed from their wallets over the past year.
The exchange also distributes large amounts of Bitcoin due to the 178% negative metric value for exchange outflows. The platform observed a large drawdown in this period due in part to the FTX collapse, which made BTC holders more aware of the risks of storing their coins in a centralized wallet. This caused a massive migration of BTC stored in centralized entities.
Users transfer large amounts of BTC from exchanges to store their holdings in privately owned hardware wallets. While not shown on the chart, Glassnode also mentions in a tweet that miners distribute 100% of the coins they mine (which means 100% of issuance), plus an additional 2% of their existing reserves.
BTC price
At the time of writing, Bitcoin is trading around $22,600, up 8% in the last week.
BTC continues to move sideways | Source: BTCUSD on TradingView
Featured image by Kanchanara on Unsplash.com, chart by TradingView.com, Glassnode.com
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