Bitcoin experiences a rise in shortterm investors according to report
A recent study by Bitfinex Alpha has revealed a shift in Bitcoin ownership patterns within the cryptocurrency market. Short-term investors are on the rise, driven by the increasing popularity of spot Bitcoin ETFs, while long-term holders continue to exhibit confidence in the market.
The report indicates a significant increase in activity among short-term Bitcoin investors, those who typically hold onto Bitcoin for less than 155 days. Their collective holdings have surged from 2.2 million BTC in January to over 3.4 million BTC in mid-April, representing a nearly 55% increase.
This surge is largely attributed to the growing influence of spot Bitcoin ETFs. The rise in short-term holders suggests a high level of investment in Bitcoin, with many investors concentrating their assets near the current market price. While this indicates significant activity at this price point, it also exposes these holders to potential risks and price fluctuations.
The number of short-term holders continues to climb as new participants enter the market and acquire Bitcoin. Despite this increase, the price remains stable as older coins are dispersed. The market appears to be stabilizing, with the $60,000-70,000 range becoming a new support level for Bitcoin, akin to how $10,000 served as a base in 2020.
Currently, short-term holders collectively possess around 3.3 million BTC, a slight decrease from the peak in mid-April. This decline can be attributed to a market correction in March following Bitcoin’s record high.
In contrast, long-term Bitcoin holders are displaying a strong sense of optimism in the market. After Bitcoin hit a new all-time high of $73,666 in March, many long-term holders sold off a significant portion of their BTC.
Recent data illustrates a shift in this trend, with long-term holders now opting to accumulate Bitcoin rather than sell. The amount of Bitcoin held by investors for over a year has remained relatively stable, indicating a preference for holding onto investments rather than actively trading.
Additionally, only a small fraction (about 0.03%) of the supply held by long-term investors consists of coins purchased at prices higher than the current spot price. During the early stages of a bull market, it is common to see long-term investors retaining their profitable positions.
Bitcoin whales are also amassing Bitcoin at a pace reminiscent of the pre-2020 bull run, resulting in a new historical high in their Bitcoin balance.
