IntoTheBlock, a company specializing in blockchain analysis, noted in a January 19 post on X (Twitter) that bitcoin prices have dropped 10% over the past week, contradicting many market predictions. Their analysis revealed several factors, including increased deposits on centralized exchanges, movement of old bitcoins, and changes in wallets of varying sizes.

Bitcoin inflows to exchanges have increased by $2 billion over the past six weeks, which may indicate a trend toward sales. Older bitcoins that had reached an all-time high in holding time began to move, possibly indicating a sell-off by long-term holders who may have invested in Grayscale Bitcoin Trust (GBTC).

The analysis also revealed a shift in bitcoins in different-sized wallets, with stocks increasing in larger wallets and decreasing in smaller ones. Long-term holders have reduced their overall holdings, while short-term traders have seen an increase in volume since October 2023.

Despite these trends, the overall bitcoin market picture is not entirely bearish. Lackluster trading volume, minimal declines in long-term holders’ balance sheets, and a relatively low MVRV ratio (1.88) suggest that bitcoin may be experiencing a temporary downturn rather than entering a serious bear market.