According to a recent report by Kraken Intelligence, the increase in the price of bitcoin in 2020 could be attributed to the holders.
The report analyzes the trend of cryptocurrency markets during 2020, up to and including November, and among other things highlights how this year the withdrawal of BTC from exchanges, on the one hand, and the supply of stablecoins, on the other, have increased significantly.
This would suggest that:
"Demand for organic spot BTC from hodlers is driving BTC appreciation."
Furthermore, it is no coincidence that he uses the term “hodler”, instead of holder, because obviously he does not refer to those who buy bitcoin to resell it tomorrow at a higher price, but to those who buy it to retain it indefinitely as a store of value.
The most striking case of the year in this sense is that of MicroStrategy, which not only bought BTC for several hundred million dollars, but also chose it as its main reserve.
In addition, in November, whales accumulated around 56,000 BTC, which probably caused the price to rise, as these may not be primarily speculative purchases.
Reason why holders have made Bitcoin grow
The point is that the BTCs bought by the hodlers are removed from the market forever, unless the owner needs to sell them.
That is, they are not bitcoins that momentarily leave the market when bought at a convenient price and then come back after the price has finally risen, but they tend to stay out of the market even when the price rises.
Therefore, the Kraken report says:
"The movement of coins off exchanges also indicates that the immediately marketable supply of BTC continues to dry up as market participants move coins to cold storage."
It also indicates that BTC is in the middle of a new bull cycle, reached an all-time high in November and remains very close to $ 20,000, although many are bracing for a correction.
Among other things, in 2020, annualized price volatility almost doubled, in monthly terms, and in November it returned to April levels.
This recent increase coincided with an increase in trading volume ($ 86 billion in November) and an all-time high on the exchange of $ 19,850.
Despite this, the November price increase would be consistent with the substantial increase in network activity, that is, not the result of a simple speculative bubble.
Bitcoin's correlations with other assets have also varied.
The correlation with “risk-free” assets, such as the dollar, gold, or US Treasuries, had risen to about 0 in early November, but then fell below -0.7 for the month.
On the other hand, compared to risky assets like the Nasdaq, Stoxx 600 and S&P 500, it had fallen to around 0 at the beginning of the month and then rose again to 0.7.
In short, in the last quarter of the month Bitcoin's situation has been changing, and it is even probable that they are not extemporaneous changes due solely to speculation.