Recently, BTC has recorded in the network again distribution phase after a short-term accumulation, which indicates that selling pressure may increase. Where are the sales coming from and what could it mean for the current price of BTC?
According to the on-chain provider Glassnode selling pressure was created primarily among long-term holders. Many of them even owned BTC at purchase prices near the 2021-2022 peak.
Long-term holders they control approx 13.337 million BTC, which represents almost 80% of the current supply in circulation. This number should be taken with a grain of salt, as it is impossible to determine exactly how many of these holders really have access to cryptocurrencies.
As we can see in the graph above, since May, long-term holders have been distributing BTC worth approximately 222,000 coins. This is roughly 1.6% of their holdings. Moreover, long-term holders realized sales at a loss. Metric LTH-SOPR is currently 0.67, which means holders have realized losses of approximately 33% on average.
What does this mean for BTC?
Most of the investors who accumulated in the 2017-2021 cycle are theirs BTC leaves. Holders from the 2021-2022 cycle, on the contrary, realize high losses. On the graph above, we could also notice that sales volumes we haven’t seen each other in a few years.
Activity in the network has also been on the decline for several months and for now does not indicate a trend reversal. If the active addresses do not start to grow, there will not be enough demand in the market. If there is no demand on the market, the price can hardly enter a bullrun. So all these metrics suggest that BTC has yet to form a bottom at the $17,600 level and the risk of a correction still exists.