Following a brief period of net spending after the early...

Following a brief period of net spending after the early November price peak, maturation has again taken the mantle as price declines. It speaks to a trend typically seen when retail/tourists have left the market, HODLers remain, and generally more bearish forward price expectation

Using the Value Days Destroyed perspective of activity, the October and November rallies saw a very mild level of spending compared to the long-term average. This is in some ways influenced by the historically high VDD values reached in early 2021, but still shows the value of spending at the recent all-time high was relatively low.

This again paints a picture of a HODLer dominated market, and low relative retail interest.

Rounding out our assessment of spending behavior is Entity-Adjusted Dormancy Flow, which compares the Bitcoin market cap (asset valuation) to the annualized dollar value of coin Dormancy (spending motive). Dormancy is the average age (in days) of spent coins per unit of BTC, which is akin to an Average Spent Output Lifespan weighted by volume.

High values of Dormancy Flow means network value is high relative to the yearly value of realized Dormancy in USD. The interpretation is that the bull market is in "healthy" conditions (spending in concert with demand valuation).Low Dormancy Flow values indicate moments where market cap is undervalued relative to the yearly sum of realized Dormancy, indicating moments where Bitcoin is a value price.

Entity-Adjusted Dormancy Flow recently bottomed out, showing a full reset of the metric. These events historically print at cyclical bottoms, and confluence with Hodler Net Position Change and the VDD Multiple hint at a potential floor of spending in the near-term, barring new surprises.

With the above three charts in tow, we can largely identify market conditions typically seen in the late stages of a macro bearish trend, often around capitulation style events. It remains to be seen whether there is more pain to the downside, perhaps in response to macro/monetary headwinds, or whether the majority of the damage has already been done and a bullish relief rally is due.