The recent bitcoin price surge to nearly $100,000 has been met with a wave of profit-taking by long-term holders, with almost 550,000 BTC – nearly 4% of their total holdings – sold off in the past few months. As the market digests this selling pressure, analysts are looking to historical patterns to gauge how much further this trend may extend.
Record Profit-Taking as Bitcoin Nears $100,000
The latest bitcoin rally, which saw the leading cryptocurrency brush against the psychologically significant $100,000 level, triggered an unprecedented surge in profit-taking by long-term holders. According to data from blockchain analytics firm Glassnode, a staggering $10.5 billion worth of bitcoin was sold on Nov. 21 alone – the largest single-day realized profit in the asset’s history.
This sell-off, primarily driven by investors who have held their bitcoin for more than 155 days (classified as “long-term holders” or “smart money”), has seen 549,119 BTC – approximately 3.85% of their total holdings – hit the market between September and November 2024. The scale of these sales even eclipsed the buying activity from major players like MicroStrategy and recently launched U.S. spot bitcoin ETFs.
Analyzing Historical Patterns
To gauge the potential extent of this long-term holder selling pressure, analysts are turning to historical data from previous bull markets. A notable trend emerges: the percentage drop in long-term holder supply has consistently decreased with each cycle.
- In the 2017 bull run, long-term holder supply dropped by 25.3%
- The 2021 cycle saw a 13.4% decrease
- Earlier in 2024, the drop was 6.51%
- The current sell-off stands at 3.85%
If this pattern holds, projections suggest another 1.19% decrease could be on the horizon, equating to around 163,031 BTC. This would bring the long-term holder supply to approximately 13.54 million BTC, aligning with the trend of higher lows and higher highs seen in each successive cycle.
Market Impact and Outlook
The substantial profit-taking by long-term holders has undoubtedly contributed to bitcoin’s recent pullback from the $100,000 threshold, with the cryptocurrency currently trading around 7.6% below its recent highs. However, analysts emphasize that such corrections are par for the course in bitcoin bull markets, often serving to flush out excess leverage and speculation.
As the market absorbs this selling pressure, attention will turn to whether the projected 163,000 BTC in further long-term holder sales materializes. While significant, this potential additional supply represents a notably smaller proportion compared to previous cycles, suggesting that the bulk of “smart money” profit-taking may have already occurred.
Ultimately, the resilience of bitcoin in the face of this record profit-taking and the diminishing scale of long-term holder sell-offs across cycles points to an increasingly mature and stable market. As the dust settles, many analysts remain bullish on bitcoin’s longer-term prospects, with some even suggesting that the $100,000 milestone may be just a pit stop on the way to even loftier heights in the coming years.
Only time will tell how the complex interplay of long-term holder behavior, institutional adoption, and evolving market dynamics will shape bitcoin’s trajectory. But one thing is certain: the world will be watching closely as this fascinating crypto market cycle continues to unfold.
