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Bitcoin Price Reverses Profits On New Years Eve; Hodlers continue to stack sats

Bitcoin (BTC) and the broader cryptocurrency market gave way later in the day on December 31st, wiping out intraday gains to round out a very successful year.

Market update

BTC price fell below $ 46,000 on December 31, and was last hovering below that level, according to data from Cointelegraph Markets Pro and TradingView. The flagship cryptocurrency is down more than 5% from its intraday high and down 2.9% on the day to trade at $ 45,933.

Bitcoin’s price is back on the defensive towards the end of the year. Source: Cointelegraph Markets Pro

Altcoins saw a similar downtrend as Bitcoin, with Ether (ETH), Binance Coin (BNB) and Solana’s SOL each falling more than 2%. Cardanos ADA fell over 4% that day.

The combined market cap of all cryptocurrencies lost over $ 100 billion from their intraday high, falling from a high of $ 2.4 trillion to $ 2.27 trillion, according to CoinGecko.

Crypto market cap declined more than $ 100 billion from its intraday high. Source: CoinGecko

The sudden turnaround followed a modest recovery rally for BTC and other cryptocurrencies that occurred early December 31st. As Cointelegraph reported, Bitcoin’s price rose more than $ 1,500 in less than an hour – a rally that may have been aided by a December expiration event valued at around $ 6 billion.

Related: Price analysis December 31: BTC, ETH, BNB, SOL, ADA, XRP, LUNA, AVAX, DOT, DOGE

Crypto OGs continue to pile up

Bitcoin has been forecasting a return of less than 60% since the beginning of the year, which is well below what many, if not most of the forecasters were demanding at the beginning of 2021. Although BTC never reached near high six-digit ratings, the leading cryptocurrency continues to attract investors with low time preferences. (Investors with little time preference place more emphasis on their financial well-being in the distant future than in the present.)

BTC’s recent price correction was largely driven by so-called crypto tourists that hit the market over the summer. As Cointelegraph recently reported, veteran owners are still selling record-low amounts of BTC in late December. Meanwhile, buying activity on Coinbase appears to have picked up significantly towards the end of the year.

Earlier this week, UTXO Management analyst Dylan LeClair said, “The real OGs are holding on,” referring to long-term Bitcoin holders having a much lower on-chain cost base than those currently selling. The average on-chain cost base for long-term BTC holders is $ 17,825, compared to $ 33,890 for those currently spending their coins.

# Long-term Bitcoin holders have an average on-chain cost base of $ 17,825, but those currently spending their coins have a cost base of $ 33,890.

The real OGs hold on. pic.twitter.com/VtxuAcZzUw

– Dylan LeClair (@DylanLeClair_) December 30, 2021

Related: Top 5 bullish bitcoin stories of 2021

In addition to the retail-oriented class of long-term hodlers, the crypto market saw an influx of discerning institutional investors in 2021. according to CoinShares data. These funds had 16 consecutive weeks of inflows through December 13.

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