- Glassnode’s weekly report showed that Bitcoin’s trajectory is similar to previous cycles.
- Long-term holders were active during Bitcoin’s climb to $100k, adding to their $2.1 billion in profits in the process.
- Tokens held for six months to 1 year have attracted the most sell-side pressure this year.
Glassnode’s Week on Chain report revealed similarities between Bitcoin’s current uptrend and previous cycles amid volatile market conditions. Meanwhile, long-term investors began distributing their tokens at the $100,000 level, culminating in a new all-time high of $2.1 billion in profit.
Bitcoin maintains historical trends despite changing market dynamics
Bitcoin witnessed an extraordinary year in 2024, soaring above the key $100k level, with annual returns of more than 130%.
According to a weekly report from blockchain analytics firm Glassnode, Bitcoin’s current price performance bears a striking resemblance to the 2015-2018 cycles. and 2018-2021, despite the changing dynamics of its market structure.
As in previous cycles, the sales pressure accompanying constant price increases remained, but at a significantly lower pace. The deepest decline in this cycle occurred on August 5, 2024, when prices fell 32% below their peak.
Likewise, this cycle was the least volatile Bitcoin cycle since its launch. “In most of the retracement, the price only fell -25% below the local top, masking this as one of the least volatile cycles to date,” Glassnode wrote.
This reduced volatility is potentially a result of demand from increased institutional interest and the introduction of spot Bitcoin exchange-traded funds (ETFs).
Strong demand has also helped Bitcoin push its price above $100,000 despite long-term holders consistently making an average of $2.1 billion in daily profits.
“If we adopt the simplifying assumption that every seller is connected to a buyer, this observation provides some insight into the strength of foreign demand, which, by contrast, has provided an estimated $2.1 billion of fresh capital into the market.”
Realized profit LTH adjusted to BTC entity | Glassnode
Glassnode analysts also pointed out that the extent of LTH’s profit-taking in the past month exceeds levels seen earlier this year when Bitcoin hit a previous all-time high of $73,000 in March.
Despite the large gains from LTHs, analysts have found that most of the recent pressure on the Bitcoin sell side is driven by new market entrants, especially those who bought Bitcoin in the last six months to a year. This group generated a profit of USD 27.3 billion, which accounts for 38.5% of the total sell-side pressure.
Cumulative realized profit of BTC by age | Glassnode
Glassnode concluded by noting redistribution of coins from old investors, “which usually happens during the later stages of a bull market.”
