Bitcoin
Short-Term Bitcoin Holders’ Profits Drop 32%, But Here’s the Good News
- Bitcoin’s short-term holder metric showed that the recent consolidation has eroded its profits.
- An influx of new investors could arrive, which could lead to a drop in prices.
Bitcoin [BTC] short-term (STH) holder profits fell 32%, crypto analyst Axel Adler observed. On March 13, the profit of STHs was 42%.
So far, although the price of Bitcoin is not much lower, the profit is 10%.
Source: Axel Adler in X
This is a positive development. The consolidation of the last two months has done its job and rattled impatient market participants. High profit levels have also reset, giving Bitcoin bulls renewed energy to push prices higher.
AMBCrypto took a closer look at network metrics to understand short- and long-term holder behavior and what insights it could bring to future price trends.
Using realized price ranges to understand holder sentiment
Source: CriptoQuant
The price age distribution metric performed by UTXO showed that holders whose Bitcoin is between 1 month and 18 months old have seen increased activity since March. The degree of this increase varied, with shorter term holders being more active in the markets.
On the other hand, Bitcoin from 18 months to 3 years has seen a decline in activity. This was a sign of reduced coin movement by these holders, which outlined even stronger bullish expectations from long-term investors.
New investors may be ready to enter the market soon
Historically, the first two months after the halving saw BTC consolidate. The reduced activity among older cohorts reflects this expectation, as they have not seen a dramatic change in activity over the past two months.
Source: Axel Adler in X
Another post by Axel Adler highlighted this. The market capitalization held by investors holding BTC for less than a month had fallen sharply in recent weeks, but was starting to rise again.
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If this upward trend continues, it could mark a new phase of Bitcoin price expansion. Investors and traders can pay attention to this metric.
With STH earnings falling, we will likely see a move north, but the demand was not yet there to drive that price movement.