Bitcoin Long-Term Holders Own 90% Of Supply In Profit

Latest data from Glassnode shows Bitcoin long-term holders currently own around 90% of the total supply in profit.

Bitcoin Supply In Profit Share Of Short-Term Holders Declines

According to the latest weekly report from Glassnode, dominance of long-term holders has observed rise recently.

The relevant indicator here is the “supply in profit,” which measures the total number of coins that are currently holding a profit in the Bitcoin market.

The metric works by checking the on-chain history of each coin to see what price it was last sold at. If this previous price was less than the current one, then the coin has now accumulated some profit.

On the other hand, the last selling price being more than the latest value of the crypto would suggest the coin is holding a loss at the moment.

The supply in profit indicator naturally only measures the former type of coins. Now, here is a chart that shows what percentage of this supply in profit is owned by the long-term holders (LTHs):

Looks like the value of the indicator has observed some rise recently: Source: Glassnode's The Week Onchain - Week 23, 2022

LTHs only include those investors who have held their Bitcoin since at least 155 days without selling or moving them. The cohort that has been holding since days less than this threshold are called the “short-term holders” (STHs).

As you can see in the above graph, it seems like in the last few weeks the percentage of the supply in profit owned by LTHs crossed the 90% mark. This means that the share of STHs shrunk below 10%.

Such values of the indicator have also been seen a few times before in the history of the crypto. Usually, those previous instances have taken place during late-stage bear market periods.

The report notes that at these values the short-term holders are nearly at a peak pain level as they hold almost no unrealized profits.

If this past trend is anything to go by, then the current LTH supply in profit of around 90% may be a sign that the crypto has started to enter into a late bear market.