<p><span style="font-weight: 400;">Only 3.5 million bitcoins — around 19% of the total outstanding supply — are used for trading, according to a </span><a href="https://blog.chainalysis.com/reports/bitcoin-market-data-exchanges-trading"><span style="font-weight: 400;">new report</span></a><span style="font-weight: 400;"> from blockchain analytics firm Chainalysis.</span></p> <p><span style="font-weight: 400;">According to the report, nearly 18.6 million bitcoins have been mined as of June 2020, and the majority of this supply is being held long-term. </span></p> <p><span style="font-weight: 400;">Chainalysis found that approximately 60% of the current supply of bitcoin is held by parties that have never sold more than 25% of the bitcoin they’ve ever received. The firm categorized this supply as “held for long-term investment.” </span></p> <p><span style="font-weight: 400;">Another 20% of the current Bitcoin supply hasn’t been moved in five years or longer, what Chainalysis calls “lost Bitcoin.” </span></p> <p><span style="font-weight: 400;">The remaining fraction is used for trading, mainly between exchanges. This amount supplies the market and helps determine the price of bitcoin, Chainalysis said. </span></p> <p><span style="font-weight: 400;">The report suggested that bitcoin being held for long term investing could eventually end up being an important source of liquidity in the market as the cryptocurrency becomes more scarce. </span></p> <p><span style="font-weight: 400;">The report also found that throughout 2020, around 340,000 people were active Bitcoin traders on a weekly basis. Chainalysis put these traders into two categories: retail and professional. It categorized retail traders as those depositing Bitcoin worth less than $10,000 USD at a time. </span></p> <p><span style="font-weight: 400;">Retail transfers account for 96% of transfers sent to exchanges, the report said. Professional traders, on the other hand, accounted for much fewer weekly transfers in 2020, despite playing a larger role in controlling market liquidity. </span></p>