Bitcoin News Today: Bitcoin Dormant Coins Reawaken as CDD Rises to 0.25 Fueling 17.59% Price Drop

Bitcoin’s dormant coins—long inactive on the blockchain—are showing renewed movement, reigniting discussions about their potential impact on BTC’s price trajectory. Recent data indicates a surge in the monthly Chainalysis Dollar Value (CDD) over yearly CDD ratio to 0.25, signaling increased distribution of dormant coins. This metric, which compares short-term to long-term distribution activity, has historically coincided with periods of price correction. For instance, similar levels were observed during Bitcoin’s 2014 collapse following the Mt. Gox scandal and the 2019 downturn after China’s cryptocurrency trading ban [1]. The current surge suggests that long-term holders (LTHs) are actively moving BTC into the market, a trend corroborated by a 240,000 BTC decline in Long Term Holder Supply over recent weeks [1].

The Holder Net Position Change, a metric tracking net BTC movements by large holders, has remained negative for seven consecutive days, hitting a low of -134.7k BTC [2]. This aligns with increased selling pressure from LTHs, who are offloading holdings as Bitcoin consolidates between $115,000 and $120,000. Analysts note that such distribution spikes often precede downward price adjustments, as large-scale selling can overwhelm market liquidity. However, the current rally remains supported by robust institutional demand. Spot ETF inflows, excluding Grayscale’s GBTC, have remained positive, with IBIT and FBTC recording cumulative inflows of $69.48 billion [3]. This institutional accumulation suggests that selling pressure from LTHs may not derail the upward trend entirely, though it could delay a retest of Bitcoin’s all-time high (~$123,000).

Historical precedents further contextualize the risks. In 2014, a CDD ratio of 0.25 coincided with a 95% price drop, while 2019’s ratio at similar levels preceded a 40% correction. The current scenario, however, differs in that institutional investors are actively absorbing supply through ETFs and treasury allocations. This dynamic creates a tug-of-war between distribution pressure and accumulation demand, with the outcome likely hinging on whether LTH selling continues or abates.

Notably, the activation of dormant addresses—such as a 14.5-year-old wallet holding 3,962 BTC (~$468 million)—has intensified speculation about potential dumping. While such movements could trigger volatility, the MVRV Z-Score—a metric comparing realized value to market value—suggests dormant coins may carry less immediate pricing influence, given their historical valuation lags [4]. Nevertheless, the sheer volume of BTC entering circulation from inactive addresses has already contributed to a 17.59% price drop in recent sessions [5].

Retail traders, meanwhile, have shown mixed signals. While institutional confidence remains high, retail activity in the $115,000–$120,000 range has skewed toward selling, reflecting caution amid consolidation [2]. This divergence underscores the complexity of predicting Bitcoin’s near-term direction. If LTH distribution slows, bulls may regain control, pushing BTC toward its previous peak. Prolonged distribution, however, could extend the consolidation phase, locking BTC in its current range until supply-demand equilibrium shifts.

Sources:

[1] [Bitcoin’s Dormant Coins Are Mass-Moving Again: What It Means for BTC](https://ambcrypto.com/bitcoins-dormant-coins-are-mass-moving-again-what-it-means-for-btc/)

[2] [Bitcoin Trapped in $115K–$120K Range as Whales Accumulate](https://www.ainvest.com/news/bitcoin-news-today-bitcoin-trapped-115k-120k-range-whales-accumulate-etf-inflows-retailers-sell-2507/)

[3] [Bitcoin Investor Loses $95M in Computer Blunder](https://www.facebook.com/groups/1151****39184645/posts/154****042867234/)

[4] [The MVRV Z-Score: A Quantitative Lens on Bitcoin’s Market Cycles](https://medium.com/@alessandroamatorij/the-mvrv-z-score-a-quantitative-lens-on-bitcoins-market-cycles-a4445210ec70)

[5] [CryptoTale | Dormant Wallet Moves BTC to Galaxy Digital](https://www.instagram.com/p/DMfDsgYypXb/)