Bitcoin: Short-term holders cash out, but all’s not lost
- Short-term holders sent more than 600k BTC tokens to exchanges since the rally took off in mid-June.
- The overall supply held by STH has been on a steady uptrend over the last month.
Bitcoin [BTC] touched $31,395 briefly on 6 July, the highest level in more than a year as the rally spurred by increased institutional interest in digital assets continued to power the market.
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The optimism has heightened after a clear endorsement by BlackRock CEO Larry Fink in a recent event where he used words like ‘international asset’ and ‘digitizing Gold’ for Bitcoin. BlackRock had submitted a new application for a Bitcoin spot ETF after the SEC identified flaws in its initial filing, thus keeping the positive sentiment intact.
Short-term holders rejoice
The prolonged bullishness continued to keep the short-term holders (STH) of the king coin interested. According to blockchain analytics firm Glassnode, this cohort of investors sent more than 600k BTC tokens to exchanges since the rally took off in mid-June.
This was the longest period of exchange engagement by STH in the recent past where the percent supply that was being sent was over 1%.
Short-term holders are the participants who keep possession of coins for less than 155 days, according to Glassnode, and are more likely to relinquish positions owing to market volatility.
As shown below, a sharp drop in supply held between 1-3 months was observed over the last 20 days. This was indicative of STH’s willingness to sell their holdings and lock in gains.
Most of the short-term holders, or the “weak hands” as they are also referred to, found it lucrative to sell their tokens.
According to blockchain research firm CryptoQuant, the Short-Term Holder SOPR has been more than 1 since the bullish rally began, indicating that most of these investors were selling their BTC holdings at profits.
Emergence of a new trend
Interestingly, despite the elevated levels of exchange interaction, the overall supply held by STH has been on a steady uptrend over the last month.
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Bitcoin’s growing stature as a safe-haven asset could have prompted these investors to see BTC as a long-term investment option rather than just a speculative asset for trading.
At the time of publication, Bitcoin was trading hands at $$30,146.39, according to CoinMarketCap. As per the latest reading of the Bitcoin Fear and Greed Index, the sentiment turned to “Greed,” indicating that market was rising.