Historical Bull Run Pattern Emerges in Bitcoin

Recent on-chain data hints at the emergence of a pattern associated with bullish trends in Bitcoin. Notably, long-term holders (LTHs), defined as investors who have retained their Bitcoin for at least a year, have exhibited behavior reminiscent of past bull markets, according to insights from the market intelligence platform IntoTheBlock.

Bitcoin Long-Term Holders Have Reversed Their Trend Recently

IntoTheBlock’s classification of hodlers as those who have held Bitcoin for a minimum of one year distinguishes them from the criteria used by other analytics firms, which typically range between five to six months. The significance lies in the addresses that have maintained their coins untouched on the blockchain, symbolizing the steadfast hands in the market.

These hodlers, known for their resilience, are characterized by their reluctance to sell, whether faced with market FUD or tempting profit-taking opportunities. The moments when these long-term holders decide to offload their holdings can carry notable implications. Monitoring their behavior involves tracking the combined BTC amount in their wallets.

Examining the trend in the total Bitcoin balance of hodlers over recent years reveals a consistent accumulation since the conclusion of the 2021 bull run. However, a noteworthy shift in the indicator’s trend has become apparent in the most recent data, indicating a potential reversal in the pattern.

It’s crucial to note that any upturns in the mentioned metric don’t necessarily indicate current buying activities. Rather, they signify purchases made a year ago, with the coins maturing to join the current cohort.

Contrastingly, the same time lag doesn’t apply to selling. When holders transfer their coins, the age resets to zero, leading to their exclusion from the long-term holder group.

Recent data suggests that long-term Bitcoin holders (LTHs) have engaged in selling activities. The analytics firm highlights that approximately 200k BTC have been sold from their collective balances since the start of the year, marking almost three consecutive months of net decreases.

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Interestingly, a comparable pattern emerged during the onset of the 2021 bull run, as depicted in the chart by IntoTheBlock. This suggests a historical parallel where LTHs ceased accumulation and began selling, mirroring the current scenario.

Throughout the previous bull run, Bitcoin hodlers reduced their holdings by 15%, while in the ongoing rally, they have divested approximately 1.5% of their reserves. As of the latest update, Bitcoin is currently trading around the $51,000 level, reflecting a 2% decrease over the past week.