Bitcoin datalogy (part I): Wave HODL


Bitcoin datalogy (part I): Wave HODL

Bitcoin uses an interesting structure based on the data, known as the UTXO is Unspent Transaction Outputs, “outputs are unspent transactions.” All UTXO have the label of the transaction/block in which it was created. Since all existing bitcoins are labels UTXO, it can be argued that every coin has its age: not only the age since the creation, but the age since the last transaction.

Unchained Capital for the first time analyzed the history through the prism of the UTXO-ages a few years ago and now we share the results of our study, because we believe them exciting and informative.

The distribution of UTXO-age of bitcoin

The diagram below demonstrates the distribution of UTXO-age of bitcoins in the historical context, starting with the Genesis block.

Colored bars indicates the percentage of available bitcoins, which participated in the transactions during selected time period. The lower, warmer colors (red, orange) — this is bitcoin, often participating in transactions. Accordingly, more than cool colors (green, blue) is the bitcoins involved in the transaction are rare. The number of bitcoins in circulation increased for all time with 50 BTC to 17 million, this figure is reflected on the left vertical axis. Black curve — the exchange rate of bitcoin to the dollar.

This table reflects the macroscopic changes of property rights to bitcoin over time. Red and orange spikes in the bottom of the chart (less than one day, from day to weeks, from weeks to months) show us an impressive amount of bitcoins suddenly were set in motion. Area of stable growth at the top (period from 2-3 years to 5 years and more) show the share of bitcoins who have not participated in transactions in the periods between the rally. The relationship between these two patterns demostriruet behavior of captainvalor during different cycles of market development.

For traditional assets such a diagram is impossible to build. Only Bitcoin and other public blackany meticulously keep track of such data since the first day of its existence. This allows for post-hoc analysis of the overall market.

Meet the Wave HODL

The typical behavior of the market price after each rally — that’s what we called “wave HODL”. First, large amounts of bitcoins at the peak of prices change owners, that is often involved in the transaction (UTXO-age — from one day to one week), then the number of such coins is on the decline — UTXO-age is growing. These coins fall into the hands of the adepts HODLа.

Visually HODL-the wave is reflected on the graph in the form of expansion of each of the color segments after the rally. The picture below shows some of the largest HODL waves.

The distribution of UTXO-age coins with superimposed local peaks in prices. Curves white point to HODL waves. Price reaches the peak, the coins change owners, actively participating in transactions that then fall into the hands of a true hontarov. We have identified three major HODL waves, not focusing on the smaller bursts. A brief history of HODL-waves

The first wave HODL: January 2009 — June 2011 ($us 0-33)

The distribution of UTXO-age for a separate period covering the first ever bitcoin HODL-wave.

The first wave is not tied to the price rally, as the bitcoin of the prices. Here we are talking about bitcoin, and the first miners, including the Satoshi.

The first year of the bitcoin community was very small, the volume of transactions is very low, and there was no kryptomere to determine the exchange rate of bitcoin to the dollar. Due to these reasons, the coins received in 2009, were rarely involved in transactions. They gradually accumulated, and their UTXO-age of ROS.

Each of the new colors representing UTXO-age, appears on the graph gradually over time. For example, green indicating elapsed since the last transaction, 12-18 months, there is clearly a year after the creation of the Genesis block. The colors succeed each other, and when bitcoins, in the absence of a transaction moving from one “age category” to another.

Because to sell bitcoins was then nowhere, and no one, this wave was the most clear HODL-wave. The first miners were the first cholerae because of the lack of alternatives. Subsequent waves HODL already more blurred, because hontarov have the opportunity at any time to convert the cryptocurrency into Fiat.

The situation started to change since mid-2010. The first crypto currency exchange including Mt. Gox, in that year began work. To them in 2011 joined Bitstamp, Kraken, Coinbase. The share of coins involved in the transaction more than 12 months, for the first time ceased to grow in June 2010. The era of online trading of bitcoin. The course for the first time reached $1 in February 2011, but the early miners coins were in the tens or hundreds of thousands. So it is understandable their desire to convert part of the BTC to cash.

23 APR 2011 when Satoshi announced, leaving his brainchild and moved on to other topics, bitcoin is already worth $1. Kriptosistema Satoshi at the time was about 1 million bitcoins, that is, he/she/they at that time already had become/became/become a millionaire. He may have decided that enough is enough?

HODL 2011: June 2011 — December 2013 (rate $33 — $1000). HODL-2011 — the second largest HODL-wave in the history of bitcoin.

In June 2011, the price of bitcoin first began to decline, and by November had slipped from $33 to $2-3. The recovery took almost two years, after which began a rally that culminated in April 2013 at $198.

During the course of the rally in June of 2011, when BTC rose to $33, all sellers of bitcoin were miners. No one else for resale it was not.

But the rally to $198 everything was different. Most were hurt with the bitcoin UTXO-age 12-24 months. They obviously were once bought by the investors of the first wave — not the miners — which have now started to sell them, using the favorable situation.

In April of 2013 till July of the same year bitcoin fell from $198 to $69, and then rushed to $1000 in December. Short period of panic sales has been replaced by a new wave of euphoria.

It was the first bitcoin-rally, who are in the news. By the time many of the major exchanges — Bitstamp, Kraken, Coinbase, not to mention Mt. Gox — worked for several years and was ready to meet the first rapid increase in demand for the cryptocurrency.

Immediately after a rapid race to the $1,000 level, more than 60% of all the coins have changed owners within 12 months. Who sold? Again it was the investors who bought bitcoin during the previous 2-3 years, in times of rising rate of BTC to peak values of $33 and $198.

Great HODL: December 2013 — December 2017 (a rate of $1000-$19000) “Great HODL 2014” is the third largest HODL-wave in the history of Bitcoin

Oh, winter bitcoin was long. Crashing in December 2013, bitcoin exchange rate returned to around $1000 in February 2017, after three long years.

But the ensuing rapid rally to $19000 more than compensated for the long wait. Mainstream media has paid the crypt is much more attention to the inflow of new investors was much more connected even the “traditionalists” among institucionales and hedge funds.

When the rate has passed the milestone of $1000 in February 2017, almost 60% of all bitcoin UTXO-age was at least 12 months. A year later, after passing a peak of $19000, these coins were only 40%. That is, in 2017 about 20% of all outstanding bitcoins uchastovat in transactions for the first time in years. What happened? We see three reasons.


Part of the transaction volume in 2017 can be explained by the desire to take profits. Sellers were investors holding bitcoin a year or more, especially revived BTC holders aged 2-5 years. 15% sold in this period bitcoin came out of this UTXO-category. Sales began almost immediately since the bitcoin back to $1000 in February 2017.


At the same time began the flowering of Ethereum, ERC20 and token-ICO. The ICO has adopted a bitcoin, many Hodler decided that having invested in bitcoin ICO, they’d jump up at the looming train ecosystem Ethereum — Bitcoin then to boast of such growth rates could not. So maybe the fever ICO was one of those forces that pushed the owners of bitcoin in the hot embrace of ether and ERC20 after years of bitcoin the winter.

Bitcoin Cash and Segregated Witness

The distribution of UTXO-ages in the period of bitcoin hard forks of Bitcoin Cash and implementation SegWit

The last factor was hardwork Bitcoin Cash August 1, 2017 and softform SegWit August 21, 2017. Both events caused massive movement of bitcoins, many of which participated in the transaction for the first time in years. Hodler in a hurry to claim the coins on both sides of the hard forks and transferred the bitcoins to a new SegWit address.

The data clearly illustrate the importance of those events. In August 2017 the number of bitcoins involved in the transaction less than a month ago has reached 25%. It’s almost 4 million of bitcoins, or $17 billion at the exchange rate at the time.

Coming HODL: Dec 2017 — ? (the course is $19000 — ?)

Today, after take-off in 2017 and fall 2018, the proportion of bitcoins that do not participate in transactions over 12 months decreased to 40%. That is, the average UTXO-age coins are now about the same as before the big rally that ended with the seizure of $1000.

And after every big rally there comes the big HODL. As the data show, we can talk about the next generation of hontarov, ready to act long-term. Since January of 2018, the proportion of bitcoins that you bought 6-12 months ago and since then has not changed owners doubled from 7.76% to 14.63%.

It will be interesting to observe the new HODL-wave in the next months (or years?). What should be the price to Hodler decided to take profits? As far as the average change UTXO-age of bitcoin before will have a change of cycle? How many new hontarov will replace the current one?

If you are interested in the answers to these questions, stay tuned. We will update the distribution graph UTXO-age (available by direct link).

Originalny text in English here.

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