On-chain data shows a massive amount of bitcoin lying dormant since 5-7 years ago with some movement observed over the last day.
bitcoin's 5-7 Years Age Band Just Showed Big Move
As noted by an analyst at CryptoQuant Quicktake mailThere has been a huge movement of dormant tokens on the bitcoin blockchain over the past day.
The relevant indicator here is the “Spent Output Age Bands” (SOAB), which basically tells us about the amount of bitcoin each age band is transferring on the blockchain at the moment.
Age bands refer to groups of coins or investors divided based on the total time they have been inactive. Coins that have not moved on the network for six to 12 months, for example, would fall into the 6 to 12 month age range.
When SOAB recorded a spike for this cohort, it would mean that the addresses that are part of this cohort have finally decided to move their coins. Overall, it's hard to say what the intention behind any move like this may be, but the downtime can perhaps provide some clues.
A large amount of btc supply continues to change rapidly due to short-term traders, so younger age bands seeing a spike is common.
Experienced hands generally remain quiet and only make movements at specific times, so SOAB peaks in those age ranges may be something worth noting. Often the purpose behind old entity moves is to sell.
In the context of the current topic, one such ancient group is of interest: the 5-7 year old age group. Here is a chart showing the trend in SOAB for this particular bitcoin age group:
<img decoding="async" class="alignnone aligncenter" src="https://technicalterrence.com/wp-content/uploads/2024/01/50000-Bitcoin-inactive-for-more-than-5-years-move-bearish.png" alt="SOAB bitcoin” width=”1411″ height=”879″ data-recalc-dims=”1″/>
Looks like the value of the metric has registered a large spike recently | Source: CryptoQuant
As shown in the chart above, bitcoin's SOAB for the 5-7 year old age group has skyrocketed, suggesting that coins that had been dormant for at least five years before this have just been moved.
This age range is among the oldest in the industry, and at these ages, the likelihood of coins actually being lost rather than simply being HODLed starts to become significant.
From the chart, you can see that a total of 49,866 btc were moved during the last spike, which is worth over $2.1 billion at the asset's current exchange rate.
The quant noted in the post that the average purchase price for coins between 5 and 7 years old would be $6,672, so this stack would have racked up a profit of around 640% by now.
This is clearly a significant profit, so this whale that has awakened after its long sleep may look to realize its profits. These coins, however, were not intended for exchanges, so the whale may not have pulled the trigger on selling them yet.
btc Price
At the time of writing, bitcoin is trading around $42,700, down 5% from last week.
<img loading="lazy" decoding="async" class="alignnone size-medium aligncenter" src="https://www.tradingview.com/x/vKQExYIT/" alt="bitcoin price chart” width=”1534″ height=”868″/>
The price of the asset seems to have been moving sideways recently | Source: BTCUSD on TradingView
Featured image from Shutterstock.com, Charts from TradingView.com, CryptoQuant.com
