HODL’ers are Relentless!
Nearing an All-Time-High in Long-Term Holder Supply
Welcome back! This week, we're diving into the fascinating world of Bitcoin HODL'ers. These relentless individuals are buying Bitcoin and moving it off exchanges into cold storage. We'll explore this trend through the key metric of Long-Term Holder (LTH) Supply, complete with a new live chart.
Today's Focus: The Resilient LTH Supply
To accurately reflect the changing market size, our chart portrays the LTH Supply as a percentage of the total Bitcoin supply.
👆 Live available at the platform under “Supply & Demand” → “LTH Supply”
Key Insights:
Skyrocketing LTH Supply: We're about to surpass the previous all-time high seen in the 2015 bear market.
Dominance of LTHs: Over 75% of the total Bitcoin supply is now in the hands of long-term holders.
Strategic Selling: Major sell-offs in LTH supply coincide with All-Time Highs (ATHs) in price, suggesting that long-term investors wisely take profits during price surges.
The New HODL'ers: Each sell-off is succeeded by a rise in LTH supply, symbolizing a new generation of HODL'ers. The class of '21 is the most recent addition.
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LTH Supply vs Illiquid Supply: Two Sides of the Same Coin
The surge in LTH supply correlates closely with our earlier findings on the increasing scarcity in Bitcoin, mainly due to Illiquid supply outstripping new supply issuance. While both LTH and Illiquid supply serve as indicators for HODLing behavior, they are derived differently—LTH supply is based on time, and Illiquid supply focuses on spending behavior. For an in-depth look at Illiquid supply, check out our previous analysis:
Cautionary Notes:
Impact of Terra/Luna, 3AC, to FTX Cascade: This has led to forced removal of Bitcoin from exchanges, artificially boosting LTH numbers. Some of these Bitcoins were already in 'poorly-stored' LTH accounts.
Market Expectations: The last bull market did not live up to the expectations of many, thanks in part to paper Bitcoin trading, futures/options, and an overabundance of Bitcoin. As a result, more so than in previous cycles, LTH supply may liquidate quickly if higher prices materialize, creating initial resistance, especially when surpassing the ATH of $69K and reaching prices towards the $100k mark.
Closing Thoughts
The tenacity of Bitcoin HODL'ers is shaping the market in intriguing ways, contributing to both increased scarcity and stability. However, it's crucial to understand the nuances behind these trends to make well-informed investment decisions. I'll keep you equipped with data-driven insights for your Bitcoin journey. Until next week!
-Root
The trend towards bitcoin being removed from exchanged too cold storage makes me more bullish on the upcoming halving and bull run. Not to mention all the spot ETFs and mega investment managers coming into the space. While it’s hard to forecast, I would not be surprised in the least if the next cycle peak is higher (percentage terms) than the last. I’ll continue to buy every week and move to cold storage until prices start to rise... then build a cash position to wait for the post cycle pullback.
Charts / cintent about specific whale BTC wallets / addresses, can we expect this in the future?