By Yasin Ebrahim
Investing.com -Bitcoin slipped below $40,000 Wednesday, but signs that point to renewed long-term demand supported sentiment on the popular crypto following its recent rout.
BTC/USD to rose 2.02% to $38,682, but had traded as high as $40,750 on the day.
Traders are starting to move their coins off exchanges to private wallets to hold bitcoin for the long haul once again, according to data earlier this week from on-chain analytics firm Glassnode.
The net transfer volume from and to exchanges – a measure that measures the ratio of BTC moved on versus off exchanges – turned negative earlier this week, indicating that more traders were moving bitcoin from exchanges to store, or ‘hodl’ BTC in private wallets, a sign of renewed appetite for long-term demand.
This measure had been positive – indicating more coins moving to rather from exchanges – since the rout began.
The buying has mostly been led by long-term investors who had been scooping up BTC in the recent rout at the expense of newer traders that were over-leveraged and forced to panic sell.
Earlier this week, Goldman Sachs (NYSE:GS) endorsed bitcoin as new asset class, driven by interest from its institutional investors who have moved from rudimentary questions about crypto including BTC to positioning questions.
“[A]sset managers and macro funds are interested in whether or not crypto fits into their portfolios, and if it does, how to get access to either the physical–by trading the spot instrument on a blockchain– or exposure through other types of products, typically futures,” Goldman Sachs said in a report.
Still, the report wasn’t all positive for bitcoin as Goldman questioned whether BTC was a true store value.
“A major argument in favor of bitcoin as a store of value is its limited supply. But demand, not scarcity, drives the success of stores of value. No other store of value has a fixed supply,” Goldman said.
Bitcoin Slips Below $40,000, but Signs ‘Hodlers’ Returning Offers Hope
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