As a seasoned crypto investor with a decade of experience under my belt, I’ve seen Bitcoin’s price action go from rollercoasters to moonshots. The recent surge in profits among long-term holders has been quite intriguing. While it’s always exciting to see those fat stacks rolling in, I can’t help but feel a pang of concern when I see such a significant release of dormant supply.
As a long-time crypto investor, I’ve noticed that Bitcoin‘s latest dramatic price rise has led to a substantial wave of selling from those who have been holding onto their Bitcoins for a while. In other words, the big gain we’ve seen recently has prompted many long-term holders to cash in their profits.
As a dedicated crypto investor, I’m thrilled to share that according to a recent analysis by Glassnode, the Long-Term Holder (LTH) group has raked in an astounding $2.02 billion in daily profits! This staggering figure surpasses the previous record set back in March 2024, establishing a completely new all-time high (ATH). It’s moments like these that remind us of the incredible potential and growth within the crypto space!
Long-Term Holders Ramp Up Distributions
As an analyst, I’ve been closely monitoring the data from our blockchain intelligence platform, and it’s revealing some intriguing trends. Over the past few months, approximately 507,000 Bitcoin coins have been distributed by long-term holders since September. This significant release of previously inactive supply suggests a potential shift in the market dynamics, as these Bitcoins were likely held for a prolonged period before being moved.
Despite being less than the 934,000 BTC sold during the earlier year’s rally, this amount still reflects a bolder strategy. On average, about 0.27% of the total Long-Term Holder (LTH) supply is being distributed every day, a level exceeded only 177 times in Bitcoin’s entire trading history.
According to Glassnode, this action plays a vital role in determining prices because it introduces substantial amounts of supply back into active trading, which has historically occurred alongside increased demand for profits, a crucial factor that helps sustain price increases.
Upon further scrutiny, it was found that the group who’ve held coins between half a year and a year have been responsible for most of the selling activity. This particular group makes up at least 35% of the total profits from sales, equating to approximately $12.6 billion.
According to Glassnode’s findings, most of the coins were acquired predominantly in the year 2023. This pattern suggests a strategy among investors known as swing trading, where they capitalized on the momentum that emerged after the introduction of spot Bitcoin exchange-traded funds (ETFs) in January.
Instead, it can be said that individuals who have kept their Bitcoin for over a year tend to be less spendthrift, indicating that those with more experience are hopeful about the digital currency’s future potential.
Supply “Air Gap” Below $88K Raises Correction Concerns
In simpler terms, Bitcoin almost reached the price point of $100,000, climbing up to $99,645. However, it then dropped by over $6,000 as some investors who bought it for short-term gains decided to cash out.
presently, it’s being traded for slightly more than 96,000 dollars, and Glassnode data suggests a possible risk area around 88,000 dollars, where there was little activity during the previous surge.
As a crypto investor, I’ve been keeping an eye on Glassnode’s insights. They’re pointing out that the supposed “air gap” in supply distribution might make prices more susceptible to downturns, particularly if demand wanes or profit-taking becomes prevalent.
Based on Bitcoin’s past price trends which include periods of increases, adjustments, and stabilization, experts believe that insufficient significant trading activity in the $88,000 region might trigger a retreat to create more robust support. Afterwards, it could potentially surge beyond $100,000 with greater certainty.
Furthermore, they propose that for the cryptocurrency to maintain an upward trend, it’s crucial for the market to counterbalance the continuous selling pressure. Interestingly, even with increased realized profits by Long-Term Holders (LTHs), there seems to be a surplus of supply in the market, despite high demand. This excess supply could potentially put downward pressure on prices temporarily, according to Glassnode’s analysis.
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2024-11-27 20:48