Survey: 55% of Cryptocurrency Investors HODL as Bitcoin and Altcoin Prices Plunge

Both the cryptocurrency and stock markets are down, with little reason to drive investors into Bitcoin and altcoins other than the positive news that Celsius has paid off all its debts and avoided a massive liquidation.

The collapse of numerous decentralized finance (DeFi) protocols, with cryptocurrency investment funds and bitcoin trading volumes 60% below all-time highs, continued to weigh on market sentiment, but some positive data suggested the market may be preparing to enter a consolidation phase.

Crypto Investors HODL

According to a recent survey conducted by Appinio, despite the slump in cryptocurrency prices and the onset of the bear market, “more than half (55%) of cryptocurrency investors held their investments in response to the recent sell-off in the cryptoasset market, with only 8% Sell their investments."

This shows that the investment conviction of most cryptocurrency investors remains strong. The study also found that “33% of U.S. investors are invested in crypto assets” and that “40% of investors see Bitcoin as the best investment opportunity in the next three months”.

U.S. investors show resilience

When it comes to U.S. investors’ reactions to a general pullback in financial markets, Appinio found that 65% of respondents hold their investments and remain confident in their choices.

Asked about their most pressing short-term concern, 66 percent of respondents cited rising inflation, 39 percent highlighted the state of the global economy and 34 percent pointed to international conflicts.

Those concerns, combined with ongoing uncertainty, "and overall rising costs of living and housing," have created "a perfect storm of setbacks" for investors, according to eToro U.S. investment analyst Callie Cox.

Cox said:

"Despite these factors, generations of investors have demonstrated a level of sophistication and understanding not to let emotions dictate important investment decisions."

Bitcoin enters the oversold zone

In addition to the resilience of cryptocurrency investors, some on-chain indicators also suggest that the market may have hit oversold territory and is ready for a period of consolidation.

According to LookIntoBitcoin, the MVRV Z-score, which combines Bitcoin's market value, realized value, and z-score, is a reliable tool that helps determine when Bitcoin is "extremely overvalued relative to its fair value or underestimate".

Bitcoin MVRV Z-score Source: LookIntoBitcoin

As shown in the chart above, periods of red z-scores entering the lower green band represent good buying opportunities, as do times when market prices dip below realized prices, a feature shown by the blue-yellow line at the top of the chart .

The Bitcoin Investor Tool from LookIntoBitcoin also provides insight into when buying or selling Bitcoin can yield outsized returns.

Bitcoin Investor Tool Source: LookIntoBitcoin

The green shaded area in the chart represents the time period when the price of Bitcoin was at a historically low level, which may represent a good buying opportunity.

It's worth noting that while the Bitcoin Investor Tool and the MVRV Z-Score are available, the duration of a bear market is different and can last for a long time, so investors are wise not to base their investment thesis fully on On any particular indicator or single indicator.