Bitcoin Long-Term Holders’ Realized Profits Surpass Past Cycles, Here’s What It Means

After a sudden pullback from its all-time high, Bitcoin’s price has continued its downward trend, retesting the $109,000 threshold. While the flagship crypto asset seems to have found stability above the $111,000 mark, on-chain data has revealed a massive uptick in realized profits following its recent surge to new highs.

Massive Profit-Taking Among Long-Term Bitcoin Holders

Bitcoin has had quite a remarkable price performance this cycle, breaking key boundaries and setting multiple all-time highs. In light of this significant upward price action, long-term BTC holders, often regarded as seasoned investors, appear to be cashing in their coins like never before. Particularly, long-term holders realized profits have risen sharply to levels that eclipse past bull market cycles. 

Glassnode, a popular financial and on-chain data analytics platform, reported the substantial rise in realized profits among these key investors in a recent post on the X platform. This increase demonstrates the unwavering faith of seasoned investors who have persevered through years of turmoil and are currently enjoying record profits. 

While it underscores Bitcoin’s maturing market structure, it also signals shifting dynamics in investor mood. Such development implies that seasoned holders are establishing the tone for what may turn out to be a defining chapter in BTC’s ongoing evolution. 

According to the analytics platform, long-term BTC holders have already made more funds this cycle than they did in every previous cycle except one, which is the 2016-2017 market cycle. Data shows that long-term holders of Bitcoin have realized profits of approximately 3.27 million BTC, drawing close to the 2016-2017 market cycle, which recorded profits of over 3.93 million BTC.

Glassnode highlighted that the rising realized profits suggest elevated sell-side pressure. When combined with other indicators, the platform noted that the development indicates that the market has moved into a late stage of the cycle.

Short-Term BTC Holders Not Making Money

As the market turns increasingly bearish, Darkfost, an on-chain expert and author, has also revealed a worrying trend among short-term BTC holders. After examining the Bitcoin Short-Term Holder Spent Output Profit Ratio (SOPR), the expert highlighted that the metric has just reached a critical juncture. Data shared by the expert shows that the metric has fallen below the level of 1. 

Darkfost highlighted that the metric’s monthly average is presently situated at the neutral point of 1. This positioning implies that short-term Bitcoin holders are no longer realizing profits, and some are actually losing money.

When this metric reaches this point, the expert claims that it often leads to two possible outcomes. Either short-term holders panic, resulting in more losses, or the market promptly recovers. Throughout this cycle, the second scenario has been more prevalent, but it has continuously presented compelling opportunities.