Bitcoin Days Destroyed

Tracks the movement of old coins weighted by dormancy - identifies smart money activity and potential market reversals

Bitcoin Days Destroyed

Tracks movement of old coins weighted by dormancy - identifies smart money activity and potential reversals

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Showing 5 years of weekly data for optimal visualization | Zoom: Click and drag | Reset: Double click

Red bars: Extreme activity | Green bars: Low activity

Extreme Activity

> 3x avg

Major smart money moves

Normal Activity

1-2x avg

Typical market activity

Low Activity

< 1x avg

Strong hodling behavior

Understanding BDD: Bitcoin Days Destroyed measures economic weight by multiplying coin amount by days dormant. When 1 BTC sits for 100 days then moves, it destroys 100 bitcoin days. Spikes indicate old coins moving (smart money activity). Context matters: spikes in bull markets = distribution (bearish), spikes in bear markets = capitulation (bullish). Low sustained BDD = strong holding.

Activity Zones

Very Low Activity(< 0.5x avg)

Low Activity(0.5 - 1.0x avg)

Normal Activity(1.0 - 1.5x avg)

Elevated Activity(1.5 - 2.0x avg)

High Activity(2.0 - 3.0x avg)

Extreme Activity(> 3.0x avg)

Metric Type

On-Chain

Coin Movement

Best For

Smart Money

Tracking

Signal Type

Reversal

Detection

Smoothing

7-Day MA

Binary BDD

Context is Critical: BDD spikes have opposite meanings depending on market context. In bull markets (price rising), extreme BDD spikes indicate long-term holders distributing to new buyers (bearish). In bear markets (price falling), extreme BDD spikes indicate forced capitulation selling by even long-term holders (bullish - marks bottoms). Always consider the trend when interpreting BDD.

Coin Movement: Measures economic significance of Bitcoin transactions

Understanding Bitcoin Days Destroyed

Bitcoin Days Destroyed (BDD) measures the economic weight of Bitcoin transactions by multiplying the amount of BTC moved by the number of days since those coins last moved. For example, if 10 BTC that have been dormant for 100 days are moved, that transaction destroys 1,000 bitcoin days. This metric identifies when long-term holders (smart money) are moving their coins.

BDD spikes indicate significant movement of old coins, which typically signals important market events. The context matters: spikes during bull markets often indicate distribution by long-term holders (bearish), while spikes during bear markets usually represent capitulation or final surrender by even the strongest hands (bullish - often marks bottoms).

The Binary BDD metric smooths the raw data with a 7-day moving average to filter out noise, making it easier to identify significant trends. By tracking the ratio of current BDD to its 90-day average, we can identify extreme activity periods that often precede major price movements.

Key Features:

• Smart Money Tracking: Identifies when long-term holders (whales and institutions) are moving coins.
• Context-Dependent Signals: Bull market spikes = distribution (bearish), bear market spikes = capitulation (bullish).
• Spike Detection: Automatically identifies extreme activity periods (>2.5x average) for reversal signals.
• Smoothed Visualization: 7-day moving average filters noise while maintaining signal quality.

How to Use BDD

In Bull Markets:

Large BDD spikes (>3x average) during price uptrends indicate long-term holders distributing to new buyers. This is often a bearish signal suggesting the rally may be nearing exhaustion. Multiple consecutive high BDD days can mark major tops (Dec 2017, Apr 2021).

In Bear Markets:

Large BDD spikes during price downtrends indicate even long-term holders are capitulating and selling at a loss. This extreme fear often marks major bottoms (Dec 2018, Nov 2022). When the strongest hands give up, the bottom is usually near.

Low BDD Periods:

Sustained low BDD (<0.5x average) indicates strong holding behavior with minimal coin movement. This accumulation phase typically occurs mid-bear market and represents smart money building positions. Low BDD + sideways price = coiled spring.

Divergences:

Watch for divergences: Rising price + falling BDD = healthy organic growth (bullish). Rising price + rising BDD = distribution phase (warning). Falling price + falling BDD = capitulation ending (bullish).

Pro Tips:

• BDD > 3x average = Extreme activity - potential reversal signal
• BDD 1.5-3x average = High activity - watch for trend confirmation
• BDD 0.5-1.5x average = Normal activity - maintain positions
• BDD < 0.5x average = Low activity - strong holding (accumulation)
• Context is critical: same spike means different things in bull vs bear
• Spikes in bull markets = bearish (distribution)
• Spikes in bear markets = bullish (capitulation/bottom)
• Multiple consecutive high BDD days = stronger signal
• Combine with price trends and other on-chain indicators
• Best for identifying major cycle turning points

Calculation & Methodology

Bitcoin Days Destroyed is calculated by multiplying the amount of BTC in each transaction by the number of days since those coins last moved. For example: 1 BTC dormant for 100 days = 100 BDD when moved. The Binary BDD applies a 7-day moving average to smooth the data. We then track the ratio to a 90-day average to identify extreme periods (>2.5x = spike). The metric is estimated from price volatility and transaction patterns when direct blockchain data is unavailable.

Variable

Value Range

> 3x avg

Extreme Activity

< 0.5x avg

Strong Hodl

Bitcoin Days Destroyed