- Market Sees Shift as Long-Term Holders Cash Out, Short-Term Traders Step In
Bitcoin (BTC) is trading at a 13% discount from its all-time high of $108,000, marking the steepest decline since early November when President-elect Donald Trump won the U.S. election. This drop has brought Bitcoin into what some investors term a correction, typically defined as a price decrease of at least 10% from a recent peak.
Long-Term Holders Drive Selling Pressure
The recent dip in Bitcoin’s price is largely attributed to selling pressure from long-term holders (LTHs), defined by Glassnode as investors who retain their BTC for at least 155 days. LTHs typically accumulate Bitcoin during price slumps and sell during market strength.
Glassnode data shows that LTHs have significantly reduced their holdings, which dropped from 14.2 million BTC in mid-September to 13.2 million BTC currently. On Thursday alone, nearly 70,000 BTC were sold by LTHs, making it the fourth-largest one-day sell-off in 2024.
Short-Term Traders Step In
While LTHs offload their holdings, short-term holders (STHs) have taken advantage of the price dip to accumulate approximately 1.3 million BTC in the same period. However, the selling by LTHs has outpaced the buying by STHs, contributing to the price decline to around $94,500.
Market Dynamics and Supply Trends
Currently, 19.8 million BTC are in circulation, with 2.8 million held on exchanges. This balance on exchanges has been steadily declining, with approximately 200,000 BTC leaving exchange wallets in recent months.
The interplay between LTHs and STHs will be a key factor in shaping Bitcoin’s price movement in the coming days. As selling pressure persists, market watchers will be closely monitoring whether STHs can absorb the supply and stabilize the market.
