On-chain data shows the short-term holder Bitcoin whales have recently increased their Realized Cap share to the highest level ever.
The Realized Cap here is an on-chain indicator that measures, in short, the total amount of capital that the BTC investors as a whole have put into the cryptocurrency. Changes in this metric reflect the incoming or outgoing of capital.
Whales can be further broken down into cohorts on the basis of holding time. Whale-sized holders who bought their coins within the past 155 days are known as the short-term holder (STH) or new whales. Similarly, those who have a holding time higher than this cutoff are called the long-term holder (LTH) or old whales.
Now, here is the chart shared by Maartunn that shows how the Bitcoin Realized Cap dominance of these two groups has changed over the past decade:
As displayed in the above graph, new whales have rapidly gained ground in the Bitcoin Realized Cap recently and hit a dominance of 44%. The STH whales represent the big-money capital that has come into the coin over the last 155 days. Thus, it would appear that 44% of the capital stored on the BTC network is currently “fresh.”
The STH whales gain Realized Cap dominance through two means: a transfer of coins between members of the cohort at a higher price and selling from the LTH whales.
LTH whales are the resolute hands of the market who hold out through volatile periods in wait for profitable exit opportunities. These smart-money investors usually ramp up their selling during bull runs and transfer their coins to new money coming into Bitcoin. As long as demand is high enough to absorb this distribution, the rally continues, but once capital inflows drop off, the asset hits a top.
So far, the growth in the STH whale Realized Cap share has maintained, but it only remains to be seen how much room is still left.
Bitcoin has been struggling to recover since Friday’s crash as its price is still trading around $111,400.
