Bitcoin sheds ‘dumb money’ as retail buys most BTC since March 2020 crash

Regular investors can now buy Bitcoin (BTC), which is $48,000, as data confirms that it has been on the rise since March 2020.

Willy Woo, a statistician, tweeted Dec. 14 that he noticed a new trend in the Bitcoin market that was absent for more than 18 months.

Retail adds Bitcoin like it’s March 2020

BTC/USD crashed to $3,600 on March 2020. This was a popular investment option for those who were able to and willing to invest. Now, this phenomenon is back.

Since March 2020, the balance changes for wallets that hold 1 BTC or less — often indicating small-scale investors — have been at their highest.

The circumstances are the same: coronavirus fears, macro market jitters, and central bank policy. However, the main difference at the end 2021 is that Bitcoin now costs $48,000 instead of $3,600.

However, interest rates are rising if the retail accumulation data is correct.

Woo stated that the last time retail bought the dip so hard was during the COVID crash.

Retail bought the dip so hard the last time was during the COVID crash. It’s possible that it is nothing, or very few, etc. pic.twitter.com/HuxNxYMl48
December 14, 2021 — Willy Woo (@woonomic).

Cointelegraph reported that larger hodlers are still showing mixed behavior at the current price levels. Whales, which are the highest tier of hodlers, are less likely to sell BTC despite being sold.

The all-time high of “Smart” vs. “dumb” money is unbeatable

The proportion of long-term investors is now at an all-time high, compared to short-term participants.

Related: Bitfinex bids suggest that Fed may ‘buy the news,’ Bitcoin price drop could end Wednesday

The so-called “Smart Money Gap” indicator is based on data from Glassnode and includes data from analytics firm Glassnode. It shows that there has never been more disparity in the BTC owned by smart and dumb money, both long-term and short term buyers.

In Bitcoin’s history, local peaks have signaled the beginning of price bull runs.

Annotated chart of the Bitcoin Smart Money Gap Source: Twitter

These numbers back the claim that Bitcoin’s close to 40% decline from its $69,000 all-time highs has “flushed out” speculative markets bets.

https://cointelegraph.com/news/bitcoin-sheds-dumb-money-as-retail-buys-most-btc-since-march-2020-crash