A pattern in the supply of the Bitcoin long-term holders could provide some hints about when the next bull run might begin in earnest.
Bitcoin HODLer Balance Has Followed A Specific Pattern In Previous Cycles
According to the market intelligence platform IntoTheBlock, the supply of the BTC HODLers is “an excellent indicator for measuring market cycles.” The “HODLers” or long-term holders (LTHs) refer to the Bitcoin investors who have held onto their coins since at least a year ago without having sold or transferred them on the blockchain.
The LTHs are the resolute hands in the market, which rarely sell their coins even when a profitable opportunity has presented itself or a deep price crash has occurred.
One way to track the behavior of these diamond hands is through the combined amount of balance they carry in their wallets. The chart below shows this Bitcoin metric trend over the past few years.
The value of the metric seems to have been steadily going up in recent months | Source: IntoTheBlock on X
As displayed in the above graph, the Bitcoin supply held by the HODLers has been showing some growth over the past couple of years, suggesting that the LTHs have been accumulating.
This rise in the indicator has also continued through the latest rally, implying that the LTHs aren’t yet ready to start taking their profits. Something to note is that when the metric goes up, it doesn’t mean buying is happening in the present.
The indicator naturally has a 1-year lag associated with it, as coins must mature for that long before they can be included in the cohort. However, this only applies to buying as the holders moving their coins to sell instantly reset the age back to zero and, hence, remove them from the group.
In the chart, the analytics firm has highlighted a pattern that the Bitcoin LTH supply has observed during the leadup to past bull runs. It would appear that the HODLers have shown accumulation in such periods.
On the other hand, the start of selling from this cohort coincided with the beginning of the bull rally in proper. So far, the HODLers have only been accumulating recently, implying that the market may be in the pre-bull run phase.
If the historical pattern indeed holds for the current cycle as well, then the HODLer supply could be one to watch, as a significant downtrend in it could turn out to be a signal that the bull run has begun once more.
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