Bitcoin’s meteoric rise continues, but a surprising trend is emerging: long-term holders (LTHs) are cashing out at an unprecedented rate. According to a recent Glassnode report, these seasoned investors are realizing a staggering $2.02 billion in daily profits—a new all-time high that eclipses even the record set in March 2024.
This massive profit-taking spree, involving over 507,000 BTC distributed since September, raises critical questions about the sustainability of Bitcoin’s current bull run. While the robust demand has so far absorbed this increased sell-side pressure, the sheer scale of the sell-off is noteworthy. The report emphasizes that this level of profit-taking is significantly higher than during previous market peaks, suggesting a potentially more aggressive distribution phase.
Interestingly, the data reveals a fascinating insight into *who* is selling. Contrary to expectations of long-held coins finally being unloaded, the majority of BTC being sold are relatively newer acquisitions. Glassnode notes that the average age of the coins being transacted is closer to six months than five years, indicating a significant contribution from mid-term investors. This is particularly evident in the 35.3% of realized profits—a total of $12.6 billion—attributed to coins held between six months and one year, likely acquired during the excitement surrounding ETF launch rallies.
The diverse strategies employed by investors are also highlighted in the profit distribution. While those with smaller percentage gains (0%-20%) locked in $10.1 billion, high-return holders (profits exceeding 300%) contributed a similar amount, at $10.7 billion. This points towards a ‘chips-off-the-table’ approach: even those with lower cost bases are achieving substantial USD profits by selling smaller quantities of their holdings.
However, there’s a nuanced aspect to consider. While the *rate* of LTH spending is higher than the previous record, the total volume of ‘coin destruction’—a metric indicating the length of time coins were held before being spent—is lower. This reinforces the observation that many of the coins entering the market are relatively recent acquisitions rather than long-term holdings finally being liquidated.
As Bitcoin nears the coveted $100,000 mark, the market is showing signs of a potential supply overhang. The rapid ascent has also created a significant ‘air gap’ below $88,000, a support level that could become crucial should the market experience a correction before attempting another leg up. The combination of record profit-taking and the emergence of this air gap suggests that while the future is bright, Bitcoin’s current trajectory is not without its potential risks. The coming weeks will be critical in determining whether this profit-taking signals a temporary breather or a more significant market shift. The market’s ability to absorb this massive wave of selling will be key to determining Bitcoin’s next major move.
