Report Reveals Long-Term Holders’ Selling and Buying Back of Bitcoin

Today’s report by CryptoQuant dives deep into the dynamics between long-term and short-term Bitcoin holders. The study uncovers an eye-opening trend: Long-Term Holders (LTHs) are strategically selling their Bitcoin to Short-Term Holders (STHs) and buying them back, especially as the market navigates through critical resistance and support levels. This masterful play could offer insight into understanding market trends and behaviors, shedding light on the crypto asset’s immediate future.

The year 2023 has been a rollercoaster for Bitcoin’s realized capitalization. The data reveales a significant increase among short-term holders (STHs), from $79 billion to $114 billion, accounting for a net change of approximately $35 billion or 1.3 million Bitcoin. This drastic change isn’t a coincidence; it reflects an underlying strategy employed by long-term holders (LTHs).

In April of this year, the Net Position Realized Cap chart highlighted a steady distribution period that lasted for six days. During this phase, long-term holders actively sold Bitcoin at $28,200. Coincidentally, this was when short-term holders were keen on acquiring the digital currency. This dynamic suggests that LTHs use market conditions to sell high and buy low.

According to experts, Bitcoin is currently navigating a crucial stage, facing immediate resistance at around $28,000 and support at approximately $25,000. Earlier in June, Bitcoin bounced off this support level, skyrocketing to a yearly high of $31,700 a month later. However, the asset has retreated to its mid-June support level and is consolidating around this price point. Per CoinMarketCap, the BTC/USD pair trades at $26,593.73 during this press.

The market is buzzing with speculation as Bitcoin’s next halving event is slated for April 17, 2024. The block reward will decrease from 6.25 BTC to 3.125 BTC, which historically has been a catalyst for significant price movements. The strategic actions of LTHs might be a precursor to the volatility expected around the halving event.