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Data from the Bitcoin Binary CDD shows that it has yet to hit the same high as the past few peaks of the cryptocurrency.
In the current 30-day MA, Bitcoin Binary CDD sits at around 0.6
Quicktake: CryptoQuant postAn analyst spoke about the Binary CDD trend for Bitcoin. The “Coin Days Destroyed” (CDD) refers to an on-chain indicator that keeps track of the total number of ‘coin days’ being reset across the network.
Coin days are the amount of cryptocurrency that a token accumulates when it is dormant for a day on the blockchain. When a coin that was previously still for some number of days is moved across the network, its coin days counter naturally resets back to zero, and the coin days that it had accumulated are said to be ‘destroyed.’
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When CDD rates a big spike, that’s an indication of dormant network hands moving. This is because long-term investors only speak up when they intend to sell. So, this type of trend could be negative for BTC.
You can also find out more about the following: Binary CDD. The actual indicator of the interest in the discussion makes it easy to determine whether or not the current HODLer activity is significant when compared with the past.
The name of this metric suggests that it can have two different values. Binary CDD = 0 is the CDD’s below average historical value and 1, when above.
The CDD is weighted by the fact that the CDD makes a comparison with historical data. This means it also adds an additional factor, namely the adjustment of the total supply at a given time. The reason for this is that the supply of an asset is increasing over time.
Here is the graph shared by the Quant that illustrates the trend of the 30 day moving average (MA), the Bitcoin Binary CDD, over the past few years.
In the graph shown above, you can see that the 30-day MA Bitcoin Binary CDD is on an uptrend, suggesting long-term traders are likely to become more active. This increase has occurred as BTC’s price has been on an upward trend, bringing it close to its all-time highest (ATH).
Even though long-term investors tend to be very resolute, they still take profits when there are significant moves. The recent trend of the Binary CDD’s 30-day MA may not surprise you.
The metric is now at 0.60. (If the difference between the Binary CDD values of 0 and 1, is confusing to you, remember that it is an average value over 30 days that is almost always in the middle).
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The chart shows that this indicator is below 0.80, the level it breached both during the highs of last year’s rally and during the phase of euphoria. 2021 bull run.
This pattern suggests that Bitcoin’s current rally may still be able to continue, at least in terms of HODLer allocation.
BTC price
Bitcoin was trading at around $102,300 as of the writing. It is up more than 3% over the last week.
Chart from TradingView.com. Image from Dall E, CryptoQuant.com.
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Source: www.newsbtc.com
