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Recent developments have deeply affected not only traditional markets but also the cryptocurrency market. Despite geopolitical issues and US macroeconomic data, a data on Bitcoin may be a source of hope for investors in the coming period. According to this data, a record portion of the current Bitcoin supply continues to be locked by investors for the long term.
Record Broken in Bitcoin
According to the on-chain data analysis firm Glassnode, more than 76% of the current Bitcoin supply continues to be locked for the long term. Long-term holders (LTHs) control a large portion of the Bitcoin supply, setting a new record in this regard.
Despite the increase in Bitcoin supply with each block mined in the ecosystem, this data shows that the short-term Bitcoin investor group has a record market presence. This issue, as mentioned by Charles Edwards, founder of the cryptocurrency asset fund Capriole Investments, is happening for the first time in Bitcoin history. Edwards made the following comment in a post on X on October 18:
“76.2% of the Bitcoin supply is currently locked by long-term holders. We have surpassed the record set in 2015. Lower supply means the same people bidding less for tokens. You do the math.”
Supply/Demand Relationship and Bitcoin
Edwards referred to the cascading effect of the LTH record. He noted that the Bitcoin supply available in the market is gradually decreasing for other market participants. According to the Glassnode chart, LTH data shows a significant increase in interest in Bitcoin since mid-2021, and investors have consistently favored “holding” throughout the bear market. Since then, the percentage of supply controlled by short-term investors has only decreased:
“I’m not referring to the demand being the same as in 2015. I mean that the price needs to rise for the same demand and decreasing supply, i.e., supply/demand economics.”
The short-term investor data (STH), which is a reverse data to LTH, is an important tracking data for analysts. The average Bitcoin price at which STHs bought in has acted as a support function for most of this year. This week, new data showed that this trend continues.
Analysts say that all the Bitcoins belonging to STHs are priced just below $27,000, and the BTC/USD pair surpassing this price this week is a significant upward momentum.
