It should be noted that BTC along with other coins did show good growth the day before. For example, here are the daily charts of Bitcoin and Etherium, where you can see the rate of increase in the price of coins.

Bitcoin and Etherium daily chart

However, the market then showed a correction, so now the coins are quite noticeably behind their recent local price highs.

Who is selling bitcoins right now?

CDD indicator calculates the number of days that each bitcoin has before it is spent, i.e. transferred to another cryptocurrency wallet. For example, 1 BTC that remained “asleep” for 100 days before being sent to another address equals 100 “accumulated days” on CDD. However, 10 BTCs that stayed dormant for 6 hours before transferring equals only 2.5 “accumulated days” because 6 hours are a quarter of a day – and therefore of 10 days. The higher the CDD metric, the more economically important the transaction is.

There have been several large spikes in the indicator readings since the beginning of the year. Almost all of these spikes are related to rising macroeconomic uncertainty and the resulting general decline in the crypto market, which pushed long-term BTC holders to lock in profits.

CDD indicator

The most significant jump in CDD was seen in February 2022, amid global geopolitical issues in the world. Fearing further declines and unwilling to take on additional risks, many long-term BTC holders pulled out of their positions. This had an avalanche effect, which caused the rest of the market to fall.

Bitcoin’s latest rally, during which the cryptocurrency broke $21,000 in resistance, prompted the sale of BTC by those who had been leaving their bitcoins idle for one to two years, according to CryptoSlate. It’s likely that these people bought Bitcoin during the coin’s local price high in January 2021 – since then, it has already fallen more than 64 percent.

BTC sales dynamics by different categories of investors

So far, Bitcoin’s price has fluctuated above the $21,000 line, with the cryptocurrency moving in a narrow horizontal channel for five consecutive days. This usually leads to a “liquidity squeeze” – a sharp move up or down in the asset.

Bitcoin price

But there is another negative factor - the Dollar Index (DXY), which shows the position of the US national currency against a basket of the world's most important currencies. The DXY is now very close to its all-time high. Historically, however, its rise leads to serious declines in both traditional markets and cryptocurrencies.

DXY Index

Now on to another topic that relates to Bitcoin. Analysts at Arcane Research have released a new report predicting the energy consumption of the Bitcoin network up to 2040. Experts have concluded that the main cryptocurrency could become a notable energy consumer on a global scale, but in order to do so, its cost would have to rise to millions of dollars. In addition, the future cost of transaction fees and the average price of electricity are significant factors.

What will happen to Bitcoin mining in the future?

If the price of BTC hypothetically reaches the $2 million mark in 17 years, the cryptocurrency will consume approximately 894 terawatt hours per year, ten times its current level. Despite the huge increase, the coin’s energy consumption will only account for 0.36 per cent of global resource generation. According to analyst Jaran Mellerud, BTC currently consumes only 0.05 percent of the world’s electricity generation. Here is his rejoinder, cited by Cointelegraph.

Currently, based on consumption of 88 terawatt hours and an average price of $50 per megawatt hour, Bitcoin miners spend about 50 percent of their income on electricity.

Projected energy consumption of the Bitcoin network

With the BTC price rising less, Bitcoin’s future energy consumption is projected to be at a much lower level. For example, the price of BTC would need to reach $500,000 by 2040 for Bitcoin to consume 223 terawatt hours per year. If the cryptocurrency’s price fixes at $100,000, mining will consume only 45 terawatt hours per year.

The analyst went on to mention the significant impact on the forecast of Bitcoin halving, an event that occurs every 210,000 blocks or approximately four years and involves a 50 per cent reduction in miners’ remuneration per block. The BTC price should rise at a huge rate due to halving, and the “negative effect” of the process for miners in the form of lower profitability could be offset by higher fees, the expert believes. He continues.

Bitcoin’s price depends on market demand for the cryptocurrency as a means of capital accumulation, while transaction fees are determined by the use of BTC as a medium of exchange.

The energy consumption of the Bitcoin network

According to Cointelegraph’s sources, the cryptocurrency’s major drop in August brought the number of cryptocurrency wallets with BTC at a loss to 17.5 million units. This figure has increased by 1.5 million wallets in the last few days alone.

Number of cryptocurrency wallets at a loss


Apparently, long-term bitcoin holders also lost their nerve the day before and decided to minimize losses by selling crypto assets. While this could have a negative impact on the digital asset in the short term, there are even benefits to such events over a longer period of time. Still, the sooner the market runs out of sellers, the sooner the industry will move to a new bullrun.

Stay tuned for more market news in our millionaires cryptochat. There we discuss other news affecting the decentralised asset industry.