Bitcoin Sales by Long-Term Holders Seem to Have Bottomed Out Van Straten
In the volatile world of cryptocurrency, Bitcoin has been making headlines once again, this time with news that could signal a shift in market dynamics. According to insights from James Van Straten, a senior analyst at CoinDesk, the sell-off by Bitcoin’s long-term holders (LTHs) appears to have reached its nadir, suggesting a potential pivot towards accumulation.
Long-term holders, often referred to as those who have held Bitcoin for over 155 days, are typically viewed as the “smart money” in the crypto world. These investors are known for their strategy of buying low during market dips and selling high during periods of exuberance. Recent data, however, indicates that this cohort might have exhausted their selling phase.
Van Straten’s analysis points to a notable decrease in the percentage of Bitcoin sold by LTHs during the latest market cycle. Previously, during bull markets of 2017 and 2021, LTHs sold off substantial portions of their holdings as the price of Bitcoin soared. However, the current data shows a reduced sell-off rate, with LTHs having sold approximately 549,119 BTC since September 2024, which is a mere 3.85% of their total holdings. This is significantly lower compared to previous cycles where the drop was as much as 25.3% in 2017 and 13.4% in 2021.
This trend suggests that the supply from long-term holders might be bottoming out, with only an estimated 163,031 BTC left to potentially hit the market if past patterns are any guide. This insight comes at a time when Bitcoin has been trading at significant levels, with a recent drop to $98,917.76 after failing to breach the $100,000 mark, indicating a possible stabilization or even a turning point in investor sentiment.
Moreover, the market has seen an increase in Bitcoin’s supply held by long-term holders, which rose by 0.06% in the last 24 hours as per IntoTheBlock data. This, coupled with over $137 million worth of Bitcoin moving off exchanges, hints at a growing preference for holding (HODLing) rather than selling. Such actions could be indicative of investors betting on higher future prices, thereby reducing the available supply on exchanges and potentially pushing prices up.
The implications of this shift are profound. If long-term holders are indeed at the tail end of their sell-off, the market might see a phase dominated by accumulation rather than distribution. This could lead to a scenario where demand outpaces supply, potentially driving Bitcoin’s price upward, especially if new capital enters the market or if short-term holders begin to accumulate in anticipation of further gains.
However, it’s crucial to consider the broader economic context, including macroeconomic policies, inflation rates, and global market sentiments, all of which can influence cryptocurrency valuations. The recent U.S. presidential election outcome, with Donald Trump securing a second term, has already shown a correlation with Bitcoin’s volatility, suggesting that political stability might play a role in investor confidence.
In conclusion, while the data and analysis by Van Straten offer a hopeful outlook for Bitcoin enthusiasts, the cryptocurrency landscape remains inherently unpredictable. Investors are advised to watch these trends closely, as the actions of long-term holders could very well dictate the next major moves in Bitcoin’s price trajectory. The potential bottoming out of LTH sales might just be the prelude to a new chapter in Bitcoin’s storied history.
