The recent price surge in Bitcoin has resulted in long-term holders profiting from their holdings. According to a market report by on-chain analytics platform Glassnode, long-term holders (LTH) are currently in profit, with only a negligible amount of 4,900 BTC (0.03% of LTH) acquired above Bitcoin’s current price. These long-term holders are mainly individuals who bought at the 2021 cycle top and have held onto their investments since then.
On the other hand, short-term holders (STH) have not been as fortunate as long-term holders. Most short-term holders are experiencing losses due to purchasing Bitcoin near local and global highs. Data from Glassnode shows that 1 million BTC (26.6%) out of the 3.35 million BTC representing the STH supply are currently at a loss. A significant portion of the STH supply (1.9 million BTC) moved into an unrealized loss during a recent price drawdown to the $58,000 level.
Glassnode’s report also highlights the behavior of short-term holders who accumulated a significant cluster of coins near the current spot price. This accumulation raises concerns about how these investors may react to volatile price fluctuations in the market. Any drastic increase or decrease in Bitcoin’s price could prompt these holders to sell off their tokens, leading to further market volatility.
In addition to long-term and short-term holders, Glassnode points out another group of investors known as ‘Single-Cycle holders.’ These investors have been holding a substantial amount of unrealized profit since Bitcoin surpassed the $40,000 range. The actions of these Single-Cycle holders can have an impact on the overall market sentiment and price movements in the future.
Overall, the recent price surge in Bitcoin has had contrasting effects on long-term and short-term holders. While long-term holders are enjoying profits, short-term holders are facing challenges due to purchasing decisions made near market highs. As market dynamics continue to evolve, it will be interesting to see how different categories of holders navigate the ever-changing crypto landscape.