Bitcoin, the world’s largest cryptocurrency, is witnessing a notable shift in its investor dynamics, as long-term holders have begun distributing their holdings to a wave of new entrants, according to an analysis report from Glassnode. This transition has sparked a fresh surge in Bitcoin’s price and realized capitalization, marking a significant milestone in the ongoing market cycle.
Glassnode’s report employs the Realized Cap metric, which tracks the transaction price for each Bitcoin to determine the proportion of holders making a profit or a loss. The metric has reached an all-time high (ATH), indicating a substantial market milestone, as stated by Glassnode.
“This results in spent coins generally being revalued from a lower cost-basis, to a higher one. As these coins change hands, we can also consider this to be an injection of fresh demand and liquidity into the asset class,” the report explains.
The Realized Cap statistic, which tracks the total USD liquidity ‘stored’ in the asset or class, has reached an unprecedented ATH value of $540 billion and is growing at an astonishing rate of more than $79 billion each month.
Glassnode’s data reveals that 44% of all Bitcoin in circulation is now held by newer addresses that have been active for less than three months. According to the firm’s analysis, rising above the 44% threshold is generally associated with mid-stage bull markets, indicating a distinct shift in investor behavior.
“If we segregate for coin-ages younger than 3 months, we can see a sharp increase over recent months, with these newer investors now owning ~44% of the aggregate network wealth,” the report states.
Glassnode researcher Checkmatey noted that the realized cap is increasing as old coins are revalued higher, with the Grayscale Bitcoin Trust (GBTC) accounting for approximately 30% of the increase, while long-term holders (HODLers) are selling the remainder.
While the analysis was conducted when Bitcoin approached an all-time high for the second time, markets began to cool earlier this week. Bitcoin reached a high of $73,734 on March 14, fell by about 17%, and recovered to $71,550 on March 28 before facing resistance. At the time of writing, BTC is trading around $66,111, down 10% from its all-time high price, according to CoinMarketCap.
This transition, marked by long-term holders realizing profits and newcomers entering the market, is a characteristic of mid-stage bull markets. As the market cycle progresses, the dynamics between long-term holders and new investors will continue to shape the trajectory of Bitcoin’s price and adoption.
