As fresh investors join, Bitcoin holders with a long-term perspective opt to sell
Bitcoin’s recent surge in price has led long-term holders to sell their holdings to new investors, resulting in an increase in the cryptocurrency’s price and realized capitalization. Glassnode, a data analytics firm, analyzed the market and found that holders who were already in profit are now distributing their coins to a fresh investor cohort. The firm uses the Realized Cap metric to determine the proportion of holders making a profit or a loss. The metric has reached an all-time high, indicating a significant market milestone. As these coins change hands, it injects fresh demand and liquidity into the asset class. The Realized Cap statistic tracks the total USD liquidity in the asset and has reached a new ATH value of $540 billion, growing at an unprecedented rate of more than $79 billion each month.
According to Glassnode, 44% of all BTC in circulation are now held by newer addresses that have been active for less than three months. This is generally associated with mid-stage bull markets. The firm also noted a distinct shift in investor behavior, with long-term holders realizing profits and re-awakening dormant supply to meet new demand at higher prices. Glassnode researcher Checkmatey explained that the realized cap is increasing as old coins are revalued higher, with GBTC accounting for approximately 30% and HODLers selling the remainder.
However, this analysis was conducted when Bitcoin approached an all-time high for the second time, and the market subsequently began to fall. BTC reached a high of $73,734 on March 14, fell by about 17%, and recovered to $71,550 on March 28 before encountering resistance. It briefly dropped below $65,000 during the Asian trading session on Wednesday before bouncing back to $66,111 at the time of writing. Bitcoin is currently down 10% from its all-time high price.
The overall market capitalization is down 1% on the day to $2.5 trillion, approximately 20% lower than its all-time peak in November 2021. Altcoins have also seen a decline, with XRP down 2.3% to $0.576 and Dogecoin down 2.7% to $0.180. Despite some fluctuations in the market, Bitcoin remains a popular investment choice for both long-term holders and new investors.
