Volatility Risk Builds as Bitcoin Supply Concentration Nears 15%
Bitcoin's supply concentration has reached a critical threshold, nearing 15% and sparking concerns about rising volatility. According to data from KuCoin, the percentage of circulating Bitcoin held by addresses whose coins were last acquired within 5% of the current spot price has climbed to 14.8%. This metric indicates that a dense cluster of holdings is sitting close to breakeven for recent buyers.
Historical observations suggest that when this concentration curve eventually turns lower, the subsequent price move often continues in the direction of the preceding trend. With the indicator still rising and no turn yet confirmed, the potential for larger price swings is increasing while the market remains range-bound.
The supply-concentration metric draws on UTXO realized-price distribution data and measures how tightly recent acquisition prices are clustered around current market levels. When a large fraction of supply sits near breakeven, relatively modest price movements can move many holders into profit or loss, potentially increasing buying or selling activity around those levels.