Bitcoin has been experiencing a change in holding maturity among owners in recent months. This is further reflected in a significant transfer of funds with long-term holders capitulating their holdings.
A subsequent accumulation has occurred that puts bitcoin in the hands of low-cost base owners.
A story about bitcoin
After the Luna collapse in May, there has been a significant divergence pattern among the long-term holders (LTH).
LTH supply has been limited between 13.56m and 13.27m BTC since the peak in November 2021.
This means that the amount held by them has dropped by only 300K BTC, half of which has been sold after the Luna explosion.
However, the situation around short-term holders (STHs) is different as they have stepped on various lows and deposited 300K BTC.
It remains to be seen whether they will eventually maintain this accumulation given the market volatility factor. STHs usually enter the market during bullish periods and sell from the bottom despite many exceptions.
Such events describe the transfer of coins to new buyers that were initially classified as STH.
Interestingly, they have a low cost base but are still in a better financial position to hold onto that.
In the macro scenario, the exchanges have seen a drop in supply since the trend started after the March 2020 capitulation.
Exchanges have seen a net outflow of -100K BTC since the Luna collapse in May 2022.
This is 3.2 per cent of the all-time high (ATH) outflows since March 2020.
As the prices fluctuated over the past year, the exchange outflows continued with great intensity. According to analytic firm Glassnode, “this underscores the persistent structural demand from investors, both small and large, for sovereign self-custodial assets.”
conclusion
Could these ownership trends pave the way for bitcoin’s steady growth? It remains to be seen as the market continues to rally in relief rally.
According to CoinMarketCap, at press time, BTC was trading just above $24,030 as selling pressure mounted in recent days.