Key Points
- Bitcoin’s Long-Term Holders (LTHs) sold 366k BTC, causing a sharp decline in the cryptocurrency’s value.
- Despite this, Bitcoin remains in a bullish phase with whales continuing to accumulate BTC.
Bitcoin’s [BTC] value experienced a drop after reaching an all-time high (ATH) of $99800, declining to a local low of $92584. At the time of writing, Bitcoin was trading at $94972, showing a 3.47% decrease over the past day.
Previously, Bitcoin had been on a steady rise, increasing by 3.44% on weekly charts and by 41.61% on monthly charts. This sudden decrease after such a significant rally prompts questions about the cause. According to Glassnode, Bitcoin’s Long-Term Holders (LTHs) may be behind it.
Who is Selling Bitcoin?
Glassnode’s analysis suggests that Bitcoin’s LTHs have begun selling, with 366k BTC tokens sold – the highest level since April. This selling activity might have created selling pressure, leading to a market pullback.
With the profit margins increasing over the past few weeks, LTHs have turned to profit-taking. The 6 million to 12 million cohorts have led this activity, spending at least 25.6k BTC tokens daily in profit. This group spent BTC with an average cost basis 71% lower than the average price of $57.9k. When BTC hit a record high of $99k, these LTHs capitalized big on the rally.
Effects on Bitcoin’s Value?
Despite the decline on daily charts, Bitcoin remains in a bullish phase. This recent pullback has allowed whales and retail traders to accumulate more BTC. Bitcoin’s Whale Exchange Ratio has decreased over the past week from 0.4 to 0.32, indicating that whales continue to accumulate BTC.
Whales are not actively transferring their BTC holdings to exchanges, a common precursor to selling. This suggests a bullish outlook among whales, who aim to hold for long-term gains. Bitcoin’s Fund flow ratio has also increased from 0.08 to 0.15, signaling increased buying pressure with more funds inflow than outflow.
The rising Stock-to-Flow (SFR) reversion also demonstrates this bullishness, suggesting growing market confidence in BTC’s value due to increased demand and adoption. Despite LTHs taking profits over the past week, BTC remains in a bullish phase, with whales accumulating and funds inflow remaining high.
Under these conditions, BTC could see further gains and may reclaim the $99,000 resistance where it has faced three rejections. Beyond these levels, there’s no significant resistance and the crypto could reach another ATH.
