Aug 26, 2023

Crypto Velocity Reaches Record Lows Before Q4 2020 BTC Price Surge's Bitcoin Velocity Hits Lows Last Seen Before Q4 2020 BTC Price Breakout
Bitcoin velocity hits lows last seen before Q4 2020 BTC price breakout

Bitcoin (BTC) activity on the blockchain has returned to levels seen prior to its 2021 all-time highs, according to data. Ki Young Ju, CEO of analytics platform CryptoQuant, highlighted the low Bitcoin velocity in an X (formerly Twitter) post on Aug. 25.

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Bitcoin supply stagnates at $26,000

Bitcoin has been stuck at its current price levels for some time now, with no major price movements in either direction. This lack of activity is reflected in the velocity of BTC units moving across the network, which is now at levels last seen in October 2020, according to CryptoQuant.

“There are two sides to this situation,” Ki commented. He pointed to the lack of major trading activity among high-volume investors, suggesting that the market is in a “wait and see” mode when it comes to BTC.

At the beginning of the year, however, there was a surge of new money entering the crypto space, as BTC/USD began its 70% Q1 winning streak, as reported by Cointelegraph.

“Oversold” RSI signal persists

The volume data is also noteworthy for another reason. In late 2020, after it had reached a long-term bottom, the metric’s increase coincided with Bitcoin’s surge past $20,000 and its subsequent record high a year later.

However, unlike then, Bitcoin appears to be oversold at its current $26,000 as indicated by its daily relative strength index (RSI) according to Cointelegraph Markets Pro and TradingView.

As reported by Cointelegraph, the 12-hour RSI reached its lowest point in five years this month and has yet to recover, which hints at a lack of investor interest.

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