Bitcoin Sees Rise in Stubborn Investors Holding onto Their Shares Amid Market Trends
Summary:
Over the past three years, Bitcoin (BTC) has gained resilient investors unwilling to sell their shares. Data shows that those who invested in late 2020 are still holding onto their coins. The long-term holders (LTHs) are not inclined to reduce their stakes, with a significant increase in coins unmoved for two to three years. They show resistance against mass profit-taking, even as BTC/USD shows a year-to-date increase of 165%. Meanwhile, short-term holders have been engaging in profit-taking over the past week.
Over the last three years, Bitcoin (BTC) has attracted a new breed of persistent investors who are resistant to selling their shares. The HODL Waves analysis reveals that those who invested in Bitcoin in late 2020 have held onto their shares. For these 'hodlers' to sell, the price of Bitcoin needs to rise significantly.
These long-term investors or long-term holders (LTHs) are not interested in reducing their shares despite the bullish trend expected in 2023. The HODL Waves, which groups the BTC supply based on the time since the last transaction, shows significant growth of a certain age group over the past year.
On the downturn of the bear market in late 2022, coins that haven't moved for two to three years have substantially grown their presence within the total supply. Last December, this group represented around 8% of the supply. Currently, their share has risen to over 15%.
In other words, those who invested in Bitcoin between December 2020 and December 2021 have resisted wholesale profit-taking.
The realized cap HODL Waves, illustrating the weighted value of coin cohorts, show the largest percentage gain in the total realized cap belonging to the 2-3 year old coins. With the increase in BTC/USD by 165% year-to-date, as confirmed by Cointelegraph Markets Pro and TradingView, the resilience of these hodlers is significant feat.
Philip Swift, the founder of the statistics tool Look Into Bitcoin, which presents the HODL Waves, usually talks about the LTH trend as veteran investors become more steadfast in maintaining their positions. He forecasted last month that a group of hodlers would remain untouched, and seasoned Bitcoin investors would not sell their shares until the price substantially increases.
Contrarily, a group known as short-term holders (STH) or speculators has been taking advantage of the rising profits over the past week. Following the rise in Bitcoin to over $40,000, these groups quickly sold their shares, selling a total of $4.5 billion of BTC in just a few days.
However, this mass sell-off had a minimal effect on the spot markets due to the large proportion of shares under LTHs' control. According to on-chain analytics company Glassnode, as of December 6, LTHs controlled 14.92 million BTC. This was slightly down from the record high of 14.95 million BTC or 76.3% of the supply seen previously on November 28.
This article is not intended as investment advice or recommendations. Each investment and trading strategy entails risk, so each reader should undertake their own research before making a decision.
Published At
12/7/2023 11:19:05 AM
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