U.Today is supported by its audience. When you buy through referral links, we may earn a commission.

Here's Who Was Responsible for Bitcoin's (BTC) Historic Price Drop

News
Tue, 03/17/2020 - 15:48
Alex Dovbnya
Weak hands were selling at a loss during the historic Thursday crash that made everyone question Bitcoin's chances to survive
Cover image via stock.adobe.com
Contents
Put your crypto to work
10
BTC
  • $68.96

    Interest per week

  • $3585.7

    Interest per year

  • 4.15%

    Interest rate

Join Now!
Sponsored by Celsius.Network

While analysts are still trying to wrap their heads around the third biggest sell-off in Bitcoin's entire history, crypto research firm CoinMetrics has determined that short-time holders were actually responsible for this. 

Related
I Will Not Let Bitcoin (BTC) Price Go to Zero: CZ Binance

Weak hands

In its most recent 'State of the Network' report, CoinMetrics noted that long-term hodlers remained on the sidelines of the recent carnage. The 38 price rout was driven by those coins that were held less than twelve months.

This explains why BTC's one-year revived supply didn't see a major spike in March. 

image by coinmetrics.substack.com

As reported by U.Today, these short-term holders were also selling their coins at a loss.  

Related
Peter Brandt Explains Why Bitcoin Halving Is 'Grossly Overrated.' Will BTC Price Skyrocket This Time?

Bitcoin becomes undervalued 

Another important tidbit that can be found in the report is that Bitcoin's market value to realized value (MVRV) slipped below 1.0. On March 12, MVRV witnessed its biggest drop since 2013.   

Speculators no longer value Bitcoin more than holders, and this could be a reliable sign that the flagship cryptocurrency is close to bottoming out. 

MVRV falling to -0.50 in December 2018 coincided with the end of the 85 percent rout. 

 

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets.

Top 10 Best Cloud Mining Sites in 2020
TOP 20 Best Bitcoin Trading Bots in 2020
Silk Road Founder Shares Update from Prison Amidst COVID-19 Pandemic
Famous British Rapper Explains Why Bitcoin Haters Will Buy BTC at $20,000
Mike Novogratz Says Bitcoin and Gold Are 'Easiest Trades,' Reveals His Favorite Stock