Bitcoin Long-Term Holders’ Profit Trends: Insights and Implications
Explore in-depth analysis of Bitcoin trends as revealed by Glassnode, indicating that long-term holders are securing more profits this cycle compared to most previous ones.
Indications of a Mature Bull Market: Bitcoin Long-Term Holders’ Profit-Taking
In a comprehensive analysis, on-chain analytics firm Glassnode delves into the ongoing cycle of Bitcoin’s long-term holders (LTHs) and their profit-taking patterns. These LTHs are investors who retain their holdings for over 155 days. Traditionally, the longer Bitcoin stays dormant in a wallet, the less likely it is to be moved or sold in the near future. Thus, these investors represent the market’s steadfast participants.
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Despite their tendency to hold, these investors are not immune to the allure of profit-taking. As they accumulate substantial gains throughout a cycle, a point eventually arrives when even the most steadfast holders are tempted to sell. Historically, peaks in their profit realization have marked the cycle’s extreme phases, making it valuable to monitor their profit-taking activities. The Realized Profit indicator serves as a useful tool in this analysis.
Assessing Bitcoin LTH Realized Profit Trends
Glassnode has published data showcasing the cumulative Bitcoin LTH Realized Profit, starting from each cycle’s initial all-time high (ATH) to its eventual peak. This metric highlights significant profit-taking by LTHs following the first ATH breakout, marking the beginning of intensified selling. The bull market persists as long as incoming demand can absorb these sales. Once demand wanes, the cycle reaches its apex.
In the current cycle, Bitcoin LTH Realized Profit has amassed 3.27 million BTC, surpassing all previous cycles except the notable 2017 bull run. This trend hints at a potential late-stage in the current cycle, further supported by the Percent Supply in Profit metric.
Percent Supply in Profit: Historical Context and Current Cycle
Another critical indicator, the Percent Supply in Profit, has been one standard deviation above its mean for 273 days in this cycle, making it the second-highest on record. Only the 2016-2018 cycle recorded more days above this threshold. Although these metrics suggest Bitcoin is in a mature phase, the possibility remains that this cycle could diverge from historical patterns. The unfolding of events will determine the cycle’s ultimate trajectory.
Current Bitcoin Price Analysis
As of now, Bitcoin is valued at approximately $113,400, reflecting a decrease of nearly 4% over the past week. The asset’s price trajectory has been predominantly bearish.
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