Former Bitcoin investors hold, short-term traders sell

According to data shared by Glassnode, those who bought Bitcoin in the early stages of the bull rally are still holding their savings despite BTC rising to all-time highs.

On-chain data source shared the “Realized Cap HODL Waves (Realized Market Value of Investor Waves)” chart. Accordingly, he stated that the number of coins in the chain in the last six months has increased from approximately 40 percent to 80 percent since the third quarter of 2020. It is stated that most of the BTC purchased during this period has not been touched since then.

While HODL Waves are used to estimate the time elapsed since BTC cryptocurrencies last moved in the chain, the realized value is derived from the last price of the coins rather than the current price. Therefore, the colored bands shown on the Realized Cap HODL Waves chart get thicker “as coins mature or spend at different age ranges”.

The data proves that a large number of BTC purchased in the later months of 2020 have not been traded since then. The chart points to coins that have matured gradually as of the fourth quarter of 2020.

Glassnode said when analyzing the chart in the May 3 Weekly Top of the Chain report: “These are coins that have accumulated in the early bull market and have remained dormant since then.”

Short term

The chart also shows that the share of the Bitcoin supply that was active six months to three years ago has declined since mid-2020, from 55 percent in July 2020 to about 10 percent now. This means that long-term investors are profiting from Bitcoin’s all-time highs.

Short-term speculation also seems to have increased since November. Roughly half of the Bitcoin supply has been processed in the past three months. This situation reveals that investors who make short-term transactions are directing the market.

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