Bitcoin Accumulation Addresses Show Signs of Intense Buying, a Bullish Signal for BTC

On-chain data shows the Bitcoin investors with no history of selling are back to intense accumulation, a sign that could be bullish for BTC's price.

On-chain data reveals that Bitcoin investors with no selling history are once again accumulating heavily, a sign that could be bullish for BTC’s price.

On-chain analytics firm CryptoQuant discussed the demand from Bitcoin’s Permanent Holders in a new post on X. Also known as Accumulation Addresses, Permanent Holders are BTC wallets that have never made an outflow transaction.

In essence, Permanent Holders are investors who have only ever bought and never sold the cryptocurrency. There are a few other restrictions on which addresses can fall into this category, a key one being that they shouldn’t be linked to miners or exchanges.

The rationale behind this is that these two entities contribute to the market's selling pressure. As a result, their holdings can be considered the "sell supply" of the cryptocurrency, which is the opposite of what Accumulation Addresses represent.

Now, here is a chart shared by the analytics firm that shows the trend in the demand from these investors over the last couple of years:

According to the above graph, the Bitcoin Accumulation Addresses were on a buying spree during the last couple of months of 2024. However, in January of this year, their demand sharply dropped to below the 30-day simple moving average (SMA).

This accumulation from the cohort is what supported the bull run and its waning is probably the reason for the slowdown in the cryptocurrency’s price that followed.

In the last few days, however, the demand from the group has once again accelerated, which means that supply is constantly being locked in the hands of these HODLers.

The indicator has also broken back above the 30-day SMA sharply, much like it did during the breakout of 2024. “Historically, this signals strong confidence and often precedes rallies,” CryptoQuant notes.

It is important to note that the Permanent Holders are not all going to be "permanent," as at least some of this group will eventually sell to reap the rewards of their patience.

However, investors with no selling history are likely to maintain it at least for some time, which is why buying from Accumulation Addresses is considered bullish.

The cohort will be interesting to watch in the coming days to see where their demand trends. This, in turn, could end up being crucial for Bitcoin. A continuation of the upwards trajectory would be positive, while a slowdown could lead to flat action in the asset.

BTC Price

Bitcoin has been unable to decide a direction in the last few days as its price is still trading around the $98,700 mark.