On-chain data shows that long-term Bitcoin holders have recently begun the distribution phase. Here’s what this could mean for the price of BTC.
Long-term Bitcoin holders just sold over 177,000 tokens
As noted by CryptoQuant community analyst Maartunn in a novel post on X, aged coins have recently seen a negative balance change. Below is a chart from market intelligence platform IntoTheBlock quoted by an analyst that shows balance changes for different groups of holders on the Bitcoin network.
The groups here are divided based on how long the coins have been held: investors who purchased their coins within the last month fall into the <1 month cohort (highlighted in yellow), while those who purchased between one and twelve months ago fall into the cohorts 1-12 Month group (pink).
In the context of the current topic, neither of these are relevant; the relevant cohort is the third (blue) cohort, which includes investors who have held the shares for more than twelve months.
Statistically, the longer an investor holds his coins, the less likely he is to sell them at any time. Thus, the 12+ month cohort would include the most determined online gamers.
It is clear from the chart that these HODLers were busy accumulating during the bear market in 2022 and the rising recovery in 2023, but in 2024 the trend changed.
During the first quarter of the year, this Bitcoin cohort’s balance change turned significantly red, indicating that long-term holders were taking advantage of their patience.
These diamond hands finally saw their selling pressure dehydrated up as the cryptocurrency’s consolidation after hitting a novel all-time high (ATH) continued until their balance change finally reached a completely neutral level.
Recently, as bullish waves returned to Bitcoin, the group balance turned red again, which means these HODLers have started selling again.
As for what this might mean for the cryptocurrency, perhaps a historical pattern could shed some lithe. “Long-term holder activity often acts as a contradictory indicator,” Maartunn says. “LTHs tend to buy (increase holdings) during price declines and sell (decrease holdings) during price surges.”
However, the chart shows that although LTHs adjust their sales to bullish increases, the actual peak of the cryptocurrency occurs only after a longer period of their distribution. This could potentially mean that BTC will have room for its current surge before a ceiling is reached.
What may invalidate this pattern, however, is the fact that the scale of LTH sales has been less intense this cycle, as IntoTheBlock noted in X post.
“While long-term holders are selling, it is less aggressive than during previous highs,” the analyst firm notes. It is therefore possible that Bitcoin’s current cycle is establishing a novel energetic in the market.
BTC price
At the time of writing, Bitcoin is trading at around $68,800, down over 3% over the past week.
