Insightful Analysis of Bitcoin HODLer Profit-Taking Trends
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Analyzing the Recent Trend in Bitcoin Long-Term Holder Realized Profits
A recent analysis by on-chain analytics firm Glassnode uncovers intriguing insights into the behavior of Bitcoin long-term holders (LTHs) regarding profit-taking activities. Long-term holders are defined as those who have retained their Bitcoin for over 155 days. Typically, the longer investors hold onto their Bitcoin, the less likely they are to sell or transfer them. This group, often characterized by their steadfast commitment, is still prone to taking profits during significant market events such as reaching new all-time highs.
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Notably, the bull run at the end of 2024 and subsequent price surges this year prompted notable profit-taking among these steadfast Bitcoin investors. The following chart illustrates the 7-day moving average (MA) of Realized Profit, indicating a recent decrease in this metric.
The Realized Profit metric measures the profits secured by Bitcoin investors, determined by comparing the selling price and the original cost of tokens involved in transactions. In July, the 7-day MA for LTH Realized Profit consistently exceeded $1 billion daily, marking one of the most substantial profit-taking phases recorded for HODLers.
Recent Changes in LTH Profit Realization Patterns
Interestingly, there has been a shift in the composition of the LTHs participating in this recent profit realization phase compared to the events of November-December. Previously, the profit-taking was led by holders within the 6-month to 12-month age bracket, largely consisting of investors newly included in the long-term holder category. These early buyers were primarily those who invested in Bitcoin spot exchange-traded funds (ETFs) that commenced trading in the US at the beginning of 2024.
In contrast, the current wave of profit-taking is predominantly driven by LTHs in the 3-year to 5-year age range, reflecting investments made between 2020 and 2022 during the previous price cycle. This indicates that the recent price rally was compelling enough to entice some of the more patient investors to sell.
While the profit-taking activity has diminished this month, it remains to be seen if this trend will continue or if a resurgence is on the horizon.
Current Bitcoin Price Trends
As of now, Bitcoin is trading at approximately $119,500, reflecting an increase of over 4.5% over the past week.
Recent Bitcoin Price Movements
The chart below provides a visual representation of Bitcoin’s price movements over the last five days.
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