Among key on-chain metrics, BTC Velocity shows how frequently Bitcoin is being transacted, while Average Dormancy reflects the average holding period of coins before they are moved. In short, Velocity tracks spending activity, and Dormancy reveals how long coins sat idle before reentering circulation.
Looking at the recent chart, there's a clear uptick in Average Dormancy in the highlighted (yellow) zone. This suggests that older, long-dormant coins—typically held by long-term holders (HODLers)—are now being moved. With Bitcoin surpassing $100K, it appears that some long-term investors are beginning to realize profits.
Meanwhile, Velocity remains relatively low, signaling that overall market activity and liquidity rotation are still subdued. This combination implies that HODLers may be cashing out, but new buying pressure might not be strong enough to fully absorb the sell-side flow.
In short, rising Dormancy points to potential short-term headwinds as previously inactive supply returns to the market. Now’s the time to watch closely—are long-held coins quietly reshaping the market dynamics?
Written by Yonsei_dent
