Charles Edwards, the founder of Capriole Fund, in a recent tweet, states that Bitcoin’s OGs are accumulating Bitcoin at the quickest rate in the last eight years. According to him, the number of people who have held Bitcoin for extremely long periods of time (five years or more), or ultra long-term holders, has been accumulating at an exponential rate over the past six months. These holders almost never part with their holdings.
Bitcoin's OGs are acquiring Bitcoin at the fastest pace in 8 years.
Bitcoin's ultra long-term holders (those that have held 5+ years) are accumulating exponentially in the last 6 months. These holders almost never sell. pic.twitter.com/reI8F7eUiX
— Charles Edwards (@caprioleio) February 1, 2023
BTC small-term holders also saw a surge
According to data obtained from on-chain transactions, the value of one bitcoin (BTC) has increased significantly over the past few weeks, helping investors both short and long-term to make a profit. Glassnode, an analytics company, reported that the percentage of short-term profiting BTC holders had increased to 97.5%, which was the highest level since November, as of January 23. According to Glassnode’s findings, long-term Bitcoin holders have also reaped financial benefits from the cryptocurrency.
Following the recent move higher in #Bitcoin prices, the Short-Term Holder (STH) cohort has seen a dramatic increase in coins held in profit.
The percentage of STH supply in profit has reached 92%, a level last seen during the May 2021 rounded top, and the Nov 2021 ATH. pic.twitter.com/moSM7lftJS
— glassnode (@glassnode) January 23, 2023
The Long Term Holder market value to realized valued ratio had also climbed above 1.0 for the very first time in six months, implying that the expected cost for long-term holders is now lower than the spot price of bitcoin. This is the first time that this ratio has risen above 1.0.
What’s causing this investor behavior?
This trend is clearly being driven by investors getting long on Bitcoin at a lower cost basis after a prolonged decline in the price of Bitcoin, which has resulted in Bitcoin’s price. But with over 97.5% of short-term supply now in the black, will newer BTC investors cash in on the price increase and become long-term holders themselves, or will they maintain their positions and wait for the price to go even higher? And what exactly should we make of either of these moves?
A number of different indicators, including the stablecoin supply ratio (SSR) and the amount of bitcoin that is being sent to exchanges, are important for investors to keep an eye on. The Stable Supply Ratio (SSR) decreases as a result of investors sending more stablecoins to exchanges in comparison to BTC. This pattern suggests that more capital is being transferred to exchanges with the intention of purchasing additional bitcoin. Remembering the exchange reserve balance of stablecoins is an important metric to keep in mind because an increase in this balance indicates increased buying pressure.
Since the 9th of January, the SSR has shown a slight upward trend, but the exchange balance for stablecoins has shown a downward trend, which may cause investors to feel uneasy. The situation is exactly the reverse with regard to the reserve balance at the bitcoin exchange. An increase in the balances of bitcoin exchanges is something that bullish investors would like not to see happen since it would imply that a greater number of investors are transferring bitcoins to exchanges with the intention of selling them. Bitcoin miners have also not been selling their Bitcoins despite the harsh market conditions.