A report from Glassnode suggests Bitcoin long-term holders have already realized more profit this cycle than in most of the previous ones.
The LTHs refer to the BTC investors who have been holding onto their coins for more than 155 days. Statistically, the longer a holder keeps their coins dormant, the less likely they are to move/sell them in the future. As such, the LTHs with their relatively long holding time are made up of the diamond hands of the market.
Though while this cohort does tend to sit silent for long stretches, it doesn’t mean its members don’t participate in selling ever. Thanks to their patience, the LTHs rack up large gains over the course of a cycle, and eventually, there comes a point where the temptation of profit-taking is too much for even these resolute hands to ward off.
Below is the chart shared by Glassnode that shows the trend in the cumulative Bitcoin LTH Realized Profit starting from when BTC set a new all-time high (ATH) in each cycle, to the cycle’s final peak.
The reason the analytics firm has picked the first ATH breakout as the start point is that these HODLers typically only ramp up their profit-taking around then. The bull run continues as long as enough demand is coming in to absorb their selling, and once inflows run out, the cycle hits its peak.
From the graph, it’s visible that the Bitcoin LTH Realized Profit has totaled 3.27 million BTC in the current cycle so far. This is more than all previous cycles, except for the 2017 bull run.
As displayed in the chart, the Bitcoin Percent Supply in Profit has exceeded a value one standard deviation above its mean on 273 days in this cycle. This is the second-highest on record, with the 2016-2018 cycle once again being the only one with more.
While both of these metrics support the idea of Bitcoin being in an extreme phase, there still remains the possibility that the current cycle will simply turn out to be different from the previous ones. As such, it only remains to be seen how things play out from here.
At the time of writing, Bitcoin is trading around $113,400, down almost 4% over the past week.
