Bitcoin (BTC) Illiquid Entities Now Hold a Record 74% of Circulating Supply

The cryptocurrency market was recently marked by important news: illiquid entities now hold a record 74% of Bitcoin's circulating supply.

Breaking News: Illiquid Entities Now Hold a Record 74% of Bitcoin's Circulating Supply

According to data tracked by ETC Group, illiquid entities now hold a record 74% of Bitcoin's circulating supply, highlighting a significant trend in the BTC ecosystem.

What Constitutes an Illiquid Entity?

An illiquid entity is an address or wallet that holds bitcoins but does not trade them frequently. These BTC are essentially “frozen” and do not actively circulate in the market. Currently, these entities possess 14.61 million BTC, out of a total circulating supply of 19.75 million BTC.

This concentration of bitcoin in illiquid wallets has several implications. It reduces the amount of BTC available for active trading, which could increase the scarcity and, consequently, the value of the cryptocurrency. Reduced supply in the face of constant or growing demand can lead to higher prices.

Furthermore, this situation reflects increased confidence among Bitcoin (BTC) holders in the long-term value of the cryptocurrency. Investors who choose to hold their bitcoins rather than sell them indicate their belief that BTC's price will continue to increase in the future.

As more bitcoins become illiquid, the market may experience reduced volatility. With less BTC available for trading, there will be less potential for drastic price fluctuations caused by massive sell-offs. However, this could also make the market more sensitive to movements when large amounts of bitcoin are eventually traded.

This development is particularly noteworthy in light of the crypto market's sluggish start to September. Investors and market observers will be keeping a close eye on this trend to understand its long-term implications.

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