The fourth #Bitcoin halving is fast approaching, estimated to be in April 2024.

In this edition, we deep dive into the impressive tightness of $BTC supply, and demonstrate how we can measure investor accumulation patterns in the lead up to the event.

By many measures of 'available supply', #Bitcoin is as tightly held by investors as it has ever been relative to total circulating supply.

Meanwhile, rates of accumulation and HODLing far exceed new issuance today.

Read more in The Week On-chain newsletter.

🔍📊 Discover Bitcoin's critical support and resistance zones in our Chart of the Week. Our analysis of Entity-Adjusted URPD reveals where the market's cost basis clusters could steer the next price movements. Watch now for essential on-chain insights to refine your trading and investment decisions. https://youtu.be/-8gIA9aaHMI

Recent volatility in Ethereum, triggered by BlackRock's move to file for a spot ETH ETF, highlights yet another pivotal moment in the digital asset landscape. This ETF could significantly impact Ethereum's supply-demand dynamics and its broader ecosystem. For investors navigating these changes, Glassnode offers essential insights for strategic decision-making. Download our one-page guide to understand how metrics like Gas Usage, Altcoin Indicator, and Capital Rotation Dynamics can inform your trading decisions, both now and in the future: https://glassno.de/47xVfDZ

In this week's Glassnode Clips, we focus on BTC and ETH vs Gold:

- Bitcoin's performance against gold was remarkable, almost doubling its gold-purchasing power with a growth exceeding 90%, demonstrating its significant ascendancy in the digital asset market.
- Ethereum, while achieving a 40% increase against gold, did not match Bitcoin's extraordinary growth, reflecting a growing performance disparity between these two leading cryptocurrencies.
- In fluctuating markets, Bitcoin and Ethereum exhibited similar trends on the downside. Yet, during periods of growth, Bitcoin consistently surpassed Ethereum, underscoring its robust performance in comparison to gold and Ethereum.

Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=G8GRxEUxZWQ

The volume of Bitcoin supply in profit has reached the levels last was seen 2 years ago as the market came off the Nov 2021 ATH. However, the magnitude of unrealized profit held within these coins remains modest, and thus far insufficient to motivate long-term holders to lock in profits.

Executive Summary
- As the market trades at yearly highs, over 83.6% of the Bitcoin coin supply is held in profit, being the highest level since November 2021 (near the ATH).

- However, the magnitude of unrealized profit held, being the delta between price and the coins cost basis, remains modest.

- The degree of unrealized profit held by investors is thus far an insufficient incentive to motivate long-term holder to spend, keeping the overall supply relatively tight.

In our latest newsletter, we break down the difference between 'coins in profit' and 'unrealized profit' in an on-chain framework. We explore this distinction further in our video report to identify periods where the market is overheated for managing risk.

🔎 Dive into our latest FinanceBridge issue to uncover the potential impact of Spot Bitcoin ETF approvals on crypto markets. This edition is packed with insights on how the approval could shift #BTC's supply and demand dynamics. We also spotlight crucial Glassnode metrics essential for navigating this new environment.

🔗 Don’t miss out on these key insights. Read the full analysis here: https://glassno.de/3usjplc

In this week's Glassnode Clips, we focus on Illiquid Supply:

- Glassnode's approach to quantifying the Illiquid Supply categorizes Bitcoin's supply based on wallet activity, distinguishing between liquid, highly liquid, and illiquid supplies.
- In contrast to highly liquid supplies such as exchange wallets, illiquid wallets are characterized by more inflows and fewer outflows, reflecting distinct holding behaviors.
- There is an increasing trend of Bitcoin moving from exchanges to illiquid states, which highlights a shift towards long-term holding and potential cold storage.

Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=PbJxxcHAVTI

🔍📊 In our latest Chart of the Week, we analyze Glassnode's 'accumulation trend score by wallet cohort'. This metric offers insights into the investment patterns of Bitcoin market participants, differentiated by the size of their holdings. It highlights how larger and smaller investors react to market changes, providing a nuanced understanding of market dynamics. This perspective can be beneficial in forming your investment approach, particularly in volatile markets. https://youtu.be/klYNF6_6Cnc

Our data science team has developed 10+ core on-chain concepts for institutions: 👇

Refine your strategy with our complete guide: https://glassno.de/46t6CMD

For now, here are 3 of these transformative metrics:

- Realized Profit and Loss: Evaluates value changes in coins from on-chain transactions, providing insights into profit or loss for financial impact assessment and market trends.

- Net Unrealized Profit and Loss (NUPL): Measures hypothetical profit or loss at current prices, highlighting the difference between acquisition costs and current values, crucial for identifying market cycles.

- Spent Output Profit Ratio (SOPR): Analyzes profit and loss across all on-chain transactions in a set period, vital for market timing and sentiment analysis.

For more personalized demonstrations or in-depth discussions, visit our institutional page: https://glassnode.com/institutions#contact

The Week On-chain 48, 2023
The growth rate of the Ethereum validator set has slowed in recent weeks, as an increasing number of validators voluntarily exit. This has slowed the rate of ETH issuance. Alongside increasing ETH burnt via EIP1559 due to growing network activity, the ETH supply has turned deflationary once again.

Executive Summary
- The Ethereum staking pool has experienced a significant trend change marked by an increasing amount of validators exiting since October. This development correlates with a broader bullish uptrend across digital asset markets.
-The increased number of validator exits has contributed to a decline in daily ETH issuance, which is related to the amount of active ETH within the staking pool.
- Simultaneously, we have seen increased network activity, driven by renewed interest in tokens and stablecoins. This is reflected by an increase in gas fees being burnt via EIP1559 triggering a deflationary turn the ETH supply.


Read more in The Week On-chain newsletter.

In this week's Glassnode Clips, we focus on URPD Cost Basis Analysis:

- URPD analysis highlights key cost basis zones, showing significant Bitcoin accumulation between $25K and $31K.
- An airgap can be noted between $31k and $33k, with price having passed through here quickly.
- Emerging trends in Bitcoin's cost basis are observed around $33K to $35K, reflecting recent profit-taking and potential future market dynamics.

Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=URTPtRoi2n8

Our Data Science team have built the Internal Reshuffling Ratio for Crypto Risk and Portfolio Managers. This indicator measures internal transaction activities within an exchange, highlighting fund management and potential risk.

- Analysis: An elevated ratio suggests heightened internal activity, possibly indicating risk factors or operational anomalies that require attention.

- Interactive View: Explore its implications in detail here: https://glassno.de/414tEZa

- Connect with Experts: Connect with our product experts here: https://glassno.de/3uJRE7X

Following the introduction of the Internal Reshuffling Ratio by our Analysts and Data Science team yesterday, we continue our series today with the Exchange Reliance Ratio for Crypto Risk and Portfolio Managers.

This innovative ratio provides insights into inter-exchange dependencies and liquidity, shedding light on market interconnectedness and potential liquidity risks.

- Analysis: Fluctuations in this ratio are key indicators of shifts in market dynamics, making it an invaluable tool for proactive risk assessment.

- Interactive View: Dive deeper into how this ratio influences market dynamics. Explore here: https://glassno.de/3R5aSfv

- Connect with Experts: For a comprehensive understanding and analysis, our expert team is available for consultation. Connect here: https://glassno.de/3uJRE7X

Building on our recent introductions of the Internal Reshuffling Ratio and the Exchange Reliance Ratio, our Analysts and Data Science team have created the Whale Withdrawal Ratio for Crypto Risk and Portfolio Managers.

This latest ratio tracks significant withdrawal activities by major investors, serving as an indicator of market confidence and stability.

- Analysis: Monitoring trends in this ratio is crucial for risk managers to anticipate and prepare for shifts in the market.

- Interactive View: Gain in-depth insights about this ratio here: https://glassno.de/3t5mDuv

- Connect with Experts: Engage with our product experts for a comprehensive understanding. Connect here: https://glassno.de/3uJRE7X

In this week's Glassnode Clips, we focus on Bitcoin Year-to-Date Performance vs USD and Gold:

- Bitcoin surged over 140% against the USD and doubled in value compared to gold this year, highlighting its robust performance and growing appeal as an investment asset.
- Gold briefly achieved a new all-time high, reaching approximately $2,150 USD, setting a significant record in its value across all fiat currencies.
- Bitcoin is increasingly competing with gold for 'sound money' investments, driven by rising institutional interest and the introduction of Bitcoin ETFs, reflecting a shift in investment strategies.

Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=cT4r0rwmGsc&t=61s

🔍📊 In our latest Chart of the Week, we examine Bitcoin whales, defined as investors with more than 1,000 BTC. Their presence in the market is linked with certain trends: an increase in their numbers during bear markets and peaks at market tops.

This year, there has been a rise in the activity of these investors, particularly when Bitcoin's price remained stable. This pattern suggests a strategic approach in their Bitcoin transactions, offering insights for market analysis. https://www.youtube.com/watch?v=b1freK9eZBs

The Week On-chain 50, 2023
Bitcoin performed a round-trip this week, rallying to new yearly highs before selling off back towards its weekly open. After such a powerful 2023 thus far, the rally seems to have met resistance, with several indicators suggesting a degree of near-term exhaustion.

Executive Summary
The strong Bitcoin uptrend found resistance this week, breaking to a new yearly high of $44.5k before experiencing the third sharpest selling off of 2023.
Several on-chain pricing models suggest that 'fair value' based on investor cost basis and network throughput are lagging, hovering between $30k and $36k.
In response to strong price appreciation over recent months, Bitcoin Short-Term Holders have taken profits at a statistically meaningful magnitude, pausing the climb.

Read more in The Week On-chain newsletter and watch our latest video analysis report.

How can institutional investors navigate the Bitcoin market post halving in April 2024? Gain insights with James Check, Glassnode's Lead Analyst and Cointime Economics co-author, in the Coinbase Institutional Podcast.

Key Insights for Institutional Investors:

- Shift in Market Dynamics Post-Halving: Exploration of how the Bitcoin market is expected to evolve post-halving, particularly focusing on the changing dynamics of supply and demand, and the impact on price movements.

- Influence of Long-term Holders: Discussion on how long-term Bitcoin holders might react to the halving event, their potential influence on market stability, and trends post-halving.

- Impact on Investment Strategies: Analysis of how institutional investors can adjust their strategies in anticipation of the halving, including considerations for risk management and capital allocation.

Discover in-depth analysis in the full episode: https://glassno.de/3RItXpB

In this week's Glassnode Clips, we focus on Bitcoin's Daily Price Change:

- Workbench is used for detailed visualization and analysis of Bitcoin's daily price changes.
- Important daily price movements in Bitcoin are highlighted using if-then statements and standard deviation bands to mark major positive and negative changes.
- The recent 5.7% sell-off is recognized as Bitcoin's third largest in 2023, with the analysis drawing on past significant market events to provide context on its volatility.

Discover more in the latest Glassnode Clips below 👇
https://www.youtube.com/watch?v=ojv9M9kAmOE

Our analysts have pinpointed three essential metrics tailored to trend traders:

The convergence of these three metrics serves as a precise indicator of critical market inflection points. Trend traders can leverage these insights for strategic decisions, whether to close long positions or initiate short positions.

Realized Cap Net Position Change

- Spotlights periods of significant capital inflows, signaling opportune moments for entering or exiting positions.
- Strategically aligned with identifying the euphoric phase of a bull market.

Binary CDD

- Highlights the timing when experienced investors divest their holdings, often following an all-time high (ATH).

Realized HODL Ratio (RHODL Ratio)

- Analyzes the wealth distribution between seasoned and novice traders.
- Reflects the transfer of wealth from informed investors to retail traders.

For personalized demonstrations or in-depth discussions, visit our institutional page: https://glassnode.com/institutions#contact

The Week On-chain 51, 2023
In this last edition for the year, we will do a whirlwind tour of what changed this year, on-chain. We will explore how the Bitcoin, Ethereum, Derivative, and Stablecoin landscapes have evolved in 2023, and how this sets up the space for an exciting road ahead.

Executive Summary
- 2023 has been an incredible year for digital assets, with Bitcoin up over 172%, correcting less than 20%, and net capital inflows into BTC, ETH and Stablecoins.
- The market has broken above several important technical and on-chain pricing models this year, with October being a major pivot point for institutional capital flows.
- Long-Term Holders currently hold a near all-time-high of the Bitcoin supply, and a super-majority of coins are now held in profit.
- Major market structure shifts are taking place, such as Tether re-asserting dominance amongst stablecoins, CME futures flipping Binance, and significant frowth of Options markets.

Read more in The Week On-Chain newsletter and watch our latest video analysis report.