HODLers Undeterred

No Pause In The Balance of Assets Belonging To ETH HODLers

Jan 26, 2024

IN TODAY’S REPORT

What we cover: NONCE SENSE Edition. On skeptics. Balance of Assets Belonging to HODLers.

A Shortage Of Skeptics?

A shortage of skeptics should concern any serious trader or investor. When no one opposes the consensus view it means that the consensus view has become dangerously entrenched, with no one left to see around it to the other side. The blind following the analytically blind.

With spot Bitcoin ETPs now approved and gathering billions of assets under management by the week, Bitcoin itself has become institutionalized. While some could argue this was already the case prior to the January 10th approvals, Bitcoin is now institutionalized down to the retail level. Mom and Pop now have easy government-approved access, not just the qualified, gold-cufflinked investing class.

With this new reality now essentially irreversible, how do we know if we’ve run out of skeptics? In other words, has the newly widespread acceptance of Bitcoin and crypto more broadly become so entrenched that we should be concerned that current price levels are dangerously frothy?

Let’s look at Ethereum and the Balance of Assets Belonging to HODLers for some insight into this question.

`ETHEREUM (ETHUSD). Daily Chart With Balance Of Assets Belonging To HODLers.`

First, this IntoTheBlock data point shows us Ethereum addresses which have been holding ETH for over one year with no movement. In other words, these addresses represent long-term investors.

Historically, the Balance of Assets Belonging to HODLers metric sees a steady decline as bull markets become more advanced and long in the tooth. Why? HODLers are finally seeing profits at such moments — often substantial — and proceed to take advantage of the extraordinarily elevated prices to move coins out of storage and into exchanges for immediate sale. In other words, these investors cease to be HODLers and the balance of assets residing at these addresses falls.

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A look at today’s chart shows just the opposite however. While Bitcoin’s Balance of Assets Belonging to HODLers metric (not shown) has seen a pullback in the wake of the spot ETP approvals and many investors exiting Grayscale’s Bitcoin Trust now that it’s no longer a closed end fund trading at a bewildering discount, Ethereum’s Balance of Assets Belonging to HODLers just hit new highs.

What’s that again?? Despite last year’s +91% performance and recent outperformance relative to Bitcoin following the approvals, the Balance of Assets Belonging to Ethereum HODLers continues to hit new highs.

Ethereum HODLers remain committed to inaction, HODLing their coins even after last year’s serious gains. Better yet, these addresses keep growing in number. ETH HODLers remain steadfast and on the rise. HODLers undeterred.

peace_love_crypto

-DB

IMPORTANT DISCLAIMER

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