Bitcoin has regained momentum following a period of decline, with its price now trading at $87,992, reflecting a 6.9% increase in the past 24 hours. The recent price movement has drawn attention to shifting supply dynamics, particularly between short-term holders (STH) and long-term holders (LTH).
This trend, analyzed by CryptoQuant contributor XBTManager, provides insights into Bitcoin’s current market cycle and what could come next.
Short-Term vs. Long-Term Holders: A Market Balancing Act
According to XBTManager, Bitcoin’s all-time high (ATH) has triggered an increase in STH supply while LTH supply declines. This transition typically signals a market shift, as long-term holders begin selling their assets while short-term traders accumulate.
This dynamic has historically played a role in determining peak levels, as increased activity from short-term holders suggests heightened speculative interest.
XBTManager explains that analyzing who is buying and selling Bitcoin is crucial in identifying market trends. As long-term holders sell their BTC, the supply moves into the hands of short-term traders, who often react more quickly to price fluctuations.
This shift indicates that Bitcoin may be in a pullback phase following its recent ATH, leading to a potential period of price consolidation. Additionally, institutional buyers and ETFs have continued to accumulate Bitcoin, behaving similarly to short-term holders during this phase.
MicroStrategy (MSTR), a major corporate Bitcoin investor, has also followed retail buying patterns. While institutional inflows support Bitcoin’s price, XBTManager warns that a prolonged consolidation period is possible due to liquidity demands.
The analyst suggests that once STH begins selling and LTH starts accumulating again, the market may stabilize, creating a more favorable environment for long positions.
What’s Next for Bitcoin?
While Bitcoin’s supply shift suggests a cooling-off phase, market participants are watching for signs of a potential trend reversal. A report from CryptoQuant highlights that real spot demand has been declining, meaning that despite recent price gains, sustained upward momentum may be difficult unless demand returns.
Additionally, IntoTheBlock recently revealed a surge in active Bitcoin addresses following last week’s price drop. This increase suggests heightened on-chain activity, often seen in periods of market transition. Whether this signals a renewed accumulation phase or continued volatility remains to be seen.
Last week’s drop triggered a surge in active addresses, pushing the daily average to its highest level since December, when Bitcoin surpassed $100k.
This uptick in on-chain activity coincided with an increase in zero-balance addresses, indicating capitulation. pic.twitter.com/eiESdiwERN
— IntoTheBlock (@intotheblock) March 4, 2025
For now, supply trends, ETF inflows, and liquidity conditions are worth monitoring to assess Bitcoin’s next move. If long-term holders re-enter the market and demand recovers, Bitcoin could see renewed upward momentum.
However, until those conditions align, XBTManager suggests that caution is necessary, particularly for high-risk trades in the current environment.
Featured image created with DALL-E, Chart from TradingView
Samuel Edyme
Meet Samuel Edyme, Nickname – HIM-buktu. A web3 content writer, journalist, and aspiring trader, Edyme is as versatile as they come. With a knack for words and a nose for trends, he has penned pieces for numerous industry player, including AMBCrypto, Blockchain.News, and Blockchain Reporter, among others.
Edyme’s foray into the crypto universe is nothing short of cinematic. His journey began not with a triumphant investment, but with a scam. Yes, a Ponzi scheme that used crypto as payment roped him in. Rather than retreating, he emerged wiser and more determined, channeling his experience into over three years of insightful market analysis.
Before becoming the voice of reason in the crypto space, Edyme was the quintessential crypto degen. He aped into anything that promised a quick buck, anything ape-able, learning the ropes the hard way. These hands-on experience through major market events—like the Terra Luna crash, the wave of bankruptcies in crypto firms, the notorious FTX collapse, and even CZ’s arrest—has honed his keen sense of market dynamics.
When he isn’t crafting engaging crypto content, you’ll find Edyme backtesting charts, studying both forex and synthetic indices. His dedication to mastering the art of trading is as relentless as his pursuit of the next big story. Away from his screens, he can be found in the gym, airpods in, working out and listening to his favorite artist, NF. Or maybe he’s catching some Z’s or scrolling through Elon Musk’s very own X platform—(oops, another screen activity, my bad…)
Well, being an introvert, Edyme thrives in the digital realm, preferring online interaction over offline encounters—(don’t judge, that’s just how he is built). His determination is quite unwavering to be honest, and he embodies the philosophy of continuous improvement, or “kaizen,” striving to be 1% better every day. His mantras, “God knows best” and “Everything is still on track,” reflect his resilient outlook and how he lives his life.
In a nutshell, Samuel Edyme was born efficient, driven by ambition, and perhaps a touch fierce. He’s neither artistic nor unrealistic, and certainly not chauvinistic. Think of him as Bruce Willis in a train wreck—unflappable. Edyme is like trading in your car for a jet—bold. He’s the guy who’d ask his boss for a pay cut just to prove a point—(uhhh…). He is like watching your kid take his first steps. Imagine Bill Gates struggling with rent—okay, maybe that’s a stretch, but you get the idea, yeah. Unbelievable? Yes. Inconceivable? Perhaps.
Edyme sees himself as a fairly reasonable guy, albeit a bit stubborn. Normal to you is not to him. He is not the one to take the easy road, and why would he? That’s just not the way he roll. He has these favorite lyrics from NF’s “Clouds” that resonate deeply with him: “What you think’s probably unfeasible, I’ve done already a hundredfold.”
PS—Edyme is HIM. HIM-buktu. Him-mulation. Him-Kardashian. Himon and Pumba. He even had his DNA tested, and guess what? He’s 100% Him-alayan. Screw it, he ate the opp.
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