Are Bitcoin’s long-term holders confident enough? Data tells us…

Journalist

Posted: December 11, 2023

• Bitcoin’s supply, held for more than a year, hit ATH for several age bands
• A marked divergence was observed in the LTH and STH supply

Bitcoin’s [BTC] bullish catalysts have deterred experienced holders from letting go of their stashes and made HODLing an attractive option.

As per AMBCrypto’s analysis of Glassnode’s data, Bitcoin’s long-term holder (LTH) supply charged to all-time highs (ATH) for several age bands in 2023. While the supply retained for at least a year accounted for 70% of all coins in circulation, unmoved stashes in the last two years increased to 57%. This was a dramatic turnaround from the distribution phase of the 2021 bull market.

Source: Glassnode

Accumulation on the rise

The upcoming halving event and optimism over spot BTC ETF approvals might have contributed to the hoarding mentality. Seasoned traders were most likely preserving their holdings for the highly anticipated bull market of 2024.

To further understand the HODLing regime, AMBCrypto examined Glassnode’s Hodler Net Position Change indicator. Generally, when new coins are accumulated by LTH, the indicator is represented as positive and green.

As is clearly evident, LTHs have steadily accumulated since the sell-offs induced by FTX’s collapse last year.

Source: Glassnode

Moreover, the amount of Bitcoin on exchanges has fallen to multi-year lows this year. In fact, at the time of writing, Bitcoin’s exchange reserve amounted to just 12% of the total circulating supply.

Source: Glassnode

Clearly, LTH were in no mood to sell. This unwillingness caused the short-term holder (STH) supply to decline further. A marked divergence was observed in the LTH and STH supply, as seen above.

All of these indicators are pointing to a robust bull cycle in 2024. This is due to the fact that comparable conditions existed as a precursor to prior bull runs as well.

How much are 1,10,100 BTCs worth today?

Will this retracement matter?

The king coin has appreciated by 70% since mid-October, prompting analysts to dub the ongoing phase as the early bull market.

However, the market sharply corrected in the last 24 hours as weak hands booked profits. At press time, BTC was exchanging hands at $42,000, down 4.28% as per CoinMarketCap.

Due to the aforementioned pullback, $85 million in BTC longs were liquidated in just four hours, according to Coinglass’ data.

Source: Coinglass