Experts at Fidelity Digital Assets view this surge in wallets as a positive indicator of Bitcoin’s growing acceptance and widespread adoption. It also signifies an increase in the number of addresses accumulating and storing Bitcoin, even as its market value continues to rise. Analysts predict positive short-term dynamics for the cryptocurrency as a result.
The report from Fidelity Digital Assets also highlights a long-term trend of decreasing Bitcoin balances on crypto exchanges. In Q1 2024, the balance decreased by 4.2% to 2.3 million BTC, which is 30% lower than the peak of 3 million BTC in 2020. It is worth noting that by the end of Q1 2024, over 99% of Bitcoin addresses were holding unrealized profits.
According to the report, “As the number of profitable addresses increases, a sell-off becomes more likely as traders and new investors seek to lock in positions.”
Additionally, Mark Yusko, CEO of Morgan Creek Capital, recently predicted that the baby boomer generation is expected to invest more than $300 billion in the cryptocurrency sector within a year.