CoinDaysDestroyed

Tech spec

Brief Description: Coin Days Destroyed (CDD) by UTXOs held for less than 155 days (Short-Term Holders) in the last day.

CoinDaysDestroyed measures the aggregate CDD from UTXOs held by Short-Term Holders (STH) that were spent within the previous day.

Metric variants

• _lth: CoinDaysDestroyed restricted to Long-Term Holders (age ≥ 155 days).
• _sth: CoinDaysDestroyed restricted to Short-Term Holders (age < 155 days).
• _non_churn: all spent outputs with a lifespan of less than 1h is excluded from the analysis.
• _normalized: normalized by the total Bitcoin supply.

Interpretation CoinDaysDestroyed is a lens through which one can gauge market behavior in Bitcoin. A high value indicates that a significant amount of bitcoins that were dormant for extended periods has been transferred, potentially signalling changes in market sentiment. This could suggest that long-term holders are taking profits or reallocating assets.

Conversely, low values of CoinDaysDestroyed imply that the market is largely driven by newer coins, which may suggest a trend of accumulation.

Advanced Explanation To understand CoinDaysDestroyed more technically, consider that each bitcoin generates one 'coinday' each day it remains unspent in a wallet. If a user holds 10 bitcoins for 10 days and then spends them, 100 'coindays' are destroyed.

CoinDaysDestroyed = ∑(Spent_UTXO_BTC_value * Spent_UTXO_Age) 

where
- Spent_UTXO_BTC_value is the bitcoin value of each spent UTXO, with age > 155 days.
- Spent_UTXO_Age is the age (in days) of each spent UTXO, with age > 155 days.