Data analytics firm Santiment says Bitcoin (BTC) is likely to keep climbing if a specific trend continues. This trend is all about the “Mean Dollar Invested Age” (MDIA).
What is MDIA?
MDIA measures the average age of all Bitcoins held in individual wallets. A falling MDIA is a good sign for Bitcoin’s price. It means older, dormant coins are being moved, showing increased activity on the network. Think of it like this: if people are suddenly using their old Bitcoins, it suggests they’re confident in the cryptocurrency’s future value.
The Bullish Signal
Santiment claims that a falling MDIA strongly suggests Bitcoin is in a bull market (a period of rising prices). They point to a recent example: after the US presidential election results in early November (which were favorable to crypto), the MDIA dropped sharply, and Bitcoin’s price jumped towards $100,000.
Santiment highlights that the MDIA has been falling steadily since October 2023, coinciding with Bitcoin’s price rally. They explain that this decline shows previously inactive Bitcoin is being used again, boosting overall network activity. In the past 13 months, the average age of a Bitcoin has dropped by 27%, from 637 days to 466 days.
The Bottom Line
In short, Santiment believes that as long as the MDIA keeps falling, Bitcoin is more likely to continue its upward trajectory. The firm sees this as a strong indicator of a healthy bull market. At the time of writing, Bitcoin is trading around $96,746.
Disclaimer: This information is for general knowledge and shouldn’t be considered investment advice. Always do your own research before investing in cryptocurrencies.
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