It’s been a rough week for the crypto market̶ and it appears to be at the hands of “n00bs.”
Ethereum’s ETH is down 15% from its all-time high of $4,356 on May 12, trading just above $3,300 at the time of writing. And Bitcoin has been hit especially hard with a 25% loss over the past seven days.
According to data from IntoTheBlock.com, the majority of people selling BTC since the end of April have been traders that have been holding onto the cryptocurrency for less than one month. From the end of April until now, wallet addresses holding Bitcoin for less than one month dropped from 5.06M addresses to 4.37M, a loss of 690,000.
Addresses holding BTC for one month to one year, labeled as “cruisers” by IntoTheBlock, dropped off too, but less significantly. The number of cruiser addresses decreased from 12.02M to 11.65M, a loss of 270,000.
Meanwhile, the number of addresses holding BTC for more than one year increased by 120,000 from 21.81M to 21.93M. The weighted average time held is 5.5 years. This suggests that while some short-term traders are selling, BTC’s core base of holders are still hodling.
The Bitcoin downturn surely has something to do with Tesla CEO Elon Musk’s tweet on May 12, announcing that Tesla had suspended vehicle purchases using BTC due to concerns over the environmental impact of Bitcoin mining and transactions.
The market tumbled further on May 16 when Musk retweeted a post saying that Bitcoiners would slap themselves when Tesla dumped all of its BTC holdings. Musk clarified afterwards that Tesla had not sold any of its BTC.
Still, those more recent entrants into Bitcoin seem to be turning their investments towards cryptocurrencies using proof of stake or other consensus algorithms that claim to be more energy efficient and eco-friendly.
Bullish on ETH
Similar to BTC, the number of long-term ETH holders has only increased since April. According to IntoTheBlock data, long-term ETH holders are up 660,000,from 33.14M addresses in April to 33.8M in May. The weighted average time held is 3.1 years.
The number of ETH “cruiser” addresses holding for one month to one year dipped though, down 260,000 addresses from 20.25M in April to 19.99M in May.
Yet unlike Bitcoin, the number of short-term ETH traders with addresses holding for less than one month has increased substantially. In April, 3.87M short-term addresses held ETH. Now in May, that number is up 880,000 to 4.75M addresses that have held ETH for a weighted average time of 10.3 days.
Despite recent market fluctuations, newer investors still seem interested in investing in ETH.