Senior Analyst: BTC "Old Coin" Shows Signs of Selling, CDD Index Soars and Lights Up Warning Signal

Bitcoin has been steadily hovering around $116,000 since its historic high, appearing calm on the surface, but on-chain data reveals some movement. CryptoQuant senior analyst Axel Adler Jr pointed out that the "Coin Days Destroyed (CDD)" ratio, which measures long-term holding behavior, has surged strongly, approaching the pre-pullback highs of 2014 and 2019, indicating that "old coins" are moving. The spike in this data has raised alarm bells, triggering the market's attention to potential selling pressure.

(Source: CryptoQuant)

CDD Soars: A Warning Sign of Long-term Holder Movement

The calculation method for CDD is "holding days × coin amount". The longer a Bitcoin remains dormant, the higher the coin age that is destroyed upon transfer. In July of this year, the monthly and annual CDD ratio surged to 0.25, a rare high in nearly a decade. Historical experience shows that when long-term holders begin to transfer assets in large quantities, the market often enters an important turning point. This data once again releases a warning signal that long-term funds may choose to lock in profits at high levels.

However, what is different this time compared to the past is that the price has not weakened simultaneously. Shortly after the CDD rose in 2014 and 2019, Bitcoin experienced a severe pullback; yet this time, the capital momentum has not disrupted the price structure, indicating that the buying power almost matches the scale of selling.

ETF Fund Inflow and Turnover: Key to Absorbing the Selling Pressure of Old Coins

The main reason is that institutional funds continue to flow in through Bitcoin ETFs. From April to now, the net inflow of ETFs has totaled about $18 billion, with an increase of $5.2 billion in July alone, primarily driven by BlackRock's IBIT. In other words, the daily demand for newly invested funds has exceeded the output from new mining, creating a "supply vacuum."

The regulatory channels brought by ETFs have lowered the entry threshold, with clear custody and tax processes, allowing previously hesitant institutional funds to quickly position themselves. When old coins exit the market, the spot demand from ETFs immediately takes over, forming a market trend that is completely different from the past "retail selling frenzy." This situation of "quiet turnover" allows old coins to quickly disperse into new, younger wallet addresses after they exit.

On-chain indicators show divergence: Changes in market structure

In addition to CDD, the Long-Term Holder Realized Profit Ratio (SOPR) has also reached a new high, indicating that the chips being transferred have indeed made significant profits. Although SOPR is at a high level, it is still lower than the peaks of past bubbles, suggesting that the market is not in a state of overall overheating.

At the same time, Bitcoin Dormancy Flow has also broken upward, reflecting that long-dormant coins are waking up. However, strong buying pressure keeps the on-chain liquidation volume stable, presenting a situation of "quiet handover" where old coins exit and quickly distribute to new, younger wallet addresses.

End of the Bull Market or New Starting Point?

If we use the experience from past halving cycles to estimate, the 18 months after the halving in April 2024 is often seen as a potential top area, currently landing around October 2025. As long as institutional demand continues, Bitcoin could still potentially short-term rally to $138,000 in theory.

The Bitcoin market may have reached the later stages of a bull market, but the structure can no longer be viewed through past experiences. Long-term chip loosening no longer necessarily leads to a cliff-like decline, as ETF flows and traditional capital depth are reshaping price elasticity. In the coming months, two things need to be observed: first, whether CDD continues to rise and pulls SOPR to new heights. Second, if ETF inflows slow down, will the supply-demand balance tilt again?

Conclusion:

The movements of Bitcoin "old coins", combined with the surge of the CDD index, have indeed raised alarm bells. However, due to the continuous influx of Bitcoin ETF funds, the market has demonstrated a different absorption capacity than in the past. This situation of "quiet handover" allows the price structure of Bitcoin to remain stable even amidst the dumping of old coins. In the future, the flow of ETF funds will be a key factor in determining the direction of the Bitcoin market.