Bitcoin’s untouched supply reached its all-time high last week, indicating that the cryptocurrency is being used as a store of value asset. 

Untouched Supply Growing

According to research published by Coin Metrics on July 23, bitcoin’s untouched supply has reached an all-time high.

The analytics firm defines untouched BTC as coins that have not been transferred out of a wallet for at least five years. As of July 19, 3.84 million bitcoin (worth about $37 billion) could be classified as untouched over the last five years, constituting 21.6% of the total 17.84 million BTC circulating supply. 

Coin Metrics speculates that the rise in untouched BTC is an indication that investors are using the technology as a store of value. Rather than frequently transferring coins between wallets and exchanges, which would exemplify trade-heavy behavior, bitcoin investors are holding for the long-term. 

However, it indicates that BTC is becoming less of a medium of exchange, at least among its current user base. 

Lost Coins

The research also shows that untouched supply historically tends to mirror price movement for bitcoin. There has been a general increase in untouched coins over time as the price of BTC has increased. However, during peaks in bitcoin pricing, the number of coins untouched for over 2 years tends to decrease, as long-term investors cash out some or all of their supply. 

Not everyone is convinced the untouched supply represents the true number of bitcoin being held. Instead, a portion of the coins could have been lost over time. 

Regulatory Pressure

Bitcoin has been experiencing price volatility since the start of July, with the currency dipping below $10,000 for the second day in a row. Coin Metrics reports that network metrics fell across the board for cryptocurrency, with ethereum taking a particularly large hit. 

However, bitcoin’s realized cap actually increased slightly over the last week. 

The report claims, 

“Realized cap is calculated by valuing each piece of the supply at the price it last moved. In other words, it prices the supply at the time holders “realized” their gains or losses. Although BTC’s market cap fell by 11%, the amount of “realized” dollars invested in BTC grew by 1%.”

Coin Metrics cited increased regulatory pressure from the US as one potential contributor to the falling price of crypto over the last month. Both the SEC and Congress have been active in putting pressure on cryptocurrency and exchanges, including the now-infamous series of tweets by President Trump attacking bitcoin.