Reasons Behind Bitcoin and the Market's Continued Sharp Decline?

Bitcoin has plunged to $95,000, dragging down altcoins, painting the market in red.

According to data from IntoTheBlock, the “Addresses by Time of Holding” indicator – which tracks the activity of Bitcoin holders over a period of 30 to 365 days – has recorded a significant decrease over the past week. This is a group of short-term investors who have taken profits, contributing to the correction in Bitcoin prices this week.

In addition, another indicator, STH-NUPL, which measures the sentiment of investors holding Bitcoin for less than 155 days, also shows a worrying trend.

Based on analysis by Glassnode, this indicator has dropped to the “hope or fear” zone (orange), reflecting investors’ skepticism about BTC’s resilience. If this trend does not improve, Bitcoin could face challenges in attracting enough demand to push prices higher.

CryptoQuant analysts have picked up on important signals from the Spent Output Age Bands (SOAB) index, a tool that tracks Bitcoin selling activity based on investors’ holding periods.

Data shows that investors who have held Bitcoin for 6–12 months have been the biggest sellers during the recent bull run. They capitalized on the gains from the early 2024 rally, when the Spot ETF officially launched, becoming a significant source of selling pressure and contributing to Bitcoin’s current stagnation.

Meanwhile, long-term investors – those who have held Bitcoin for more than a year – have had relatively low levels of selling during this period.

In addition, the Binary CDD (Coin Days Destroyed) index also recorded that the sales of old Bitcoin in December decreased compared to November. This shows that many long-term investors still maintain their confidence in the potential for Bitcoin’s price increase in the future and maintain their positions.