81% of Bitcoin Remains Inactive for 6 Months, Price Rises Due to Supply Decrease

81% of the circulating supply of Bitcoin (BTC) has not moved for at least six months. The price has rebounded by about 50% from the low in June, but trading volume and inflows into exchange-traded funds (ETFs) have been sluggish, highlighting that the decrease in supply is a major factor behind the recent price increase. According to a report by River, long-term holders have increased their holdings by over 3 million BTC since 2020, but only 300,000 BTC have moved in the first half of this year. Bitcoin exchange trading volume has decreased by about 30% compared to the beginning of the year, and the buying volume for the U.S. spot Bitcoin ETF in September also fell below the monthly average. Individual holders net sold 140,000 BTC in the first half of this year but accumulated over 107,000 BTC again in the third quarter. Assuming the circulating supply of Bitcoin is 19.7 million BTC, the amount that has moved in the last six months is about 3.7 million BTC, or 19%. The increase in long-term holdings could impact short-term liquidity, and if demand weakens, there is a possibility of increased price volatility. River assessed that while the supply side of the market has tightened, there has not yet been a significant increase in actual demand.

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