Long-term Bitcoin holders took profits at record levels with realized gains hitting $1.7 billion daily as older coins re-entered circulation.
The price of Bitcoin will have a challenging road ahead as long as long-term holders continue to take profits, according to analysts.
The failure of crypto markets to recover was not due to manipulation, paper Bitcoin, or suppression, “just good old-fashioned sellers,” said analyst James Check on Sunday.
Check added that the sheer volume of sell-side pressure from existing Bitcoin
holders is still not widely appreciated, and that it was “the source of resistance” at the moment.
The analyst shared a chart showing that the average age of spent coins has drifted higher throughout the cycle, indicating that long-term holders were the ones selling.
Another chart showed that realized profit had spiked to $1.7 billion per day while realized losses climbed to $430 million per day, the third highest level this cycle.
Meanwhile, the “revived supply” from older coins reached its second-highest level at $2.9 billion per day.
Older coins re-enter supply as old hands take profits. Source: James Check
Bitcoin OGs taking profits
Crypto investor Will Clemente said that “the last year of relative weakness for BTC has mostly been a transfer of supply from OGs to TradFi,” which can be seen in onchain data.
“This dynamic will be mostly irrelevant in the coming years, just as everyone is focused on BTC’s relative weakness.”
Related: John Bollinger says to ‘pay attention soon’ as big move could be imminent
Galaxy Digital CEO Mike Novogratz echoed the sentiment in an interview with Raoul Pal last week.
“There are a lot of people in the Bitcoin world who had rode this so long and finally decided, ‘I wanna buy something’,” he said, citing friends who bought a yacht and part of a sports team.
“People trimming because they’ve had a great run and we’re just digesting that turnover.”
Novogratz confirmed that the only supply his firm has seen is “old OGs” and miners.
Weekly close holds support
Bitcoin has held onto support with a weekly closing candle at $108,700, according to TradingView.
“Continued holding here could see price rally to $120k+ over time. Stability here is absolutely key,” said analyst “Rekt Capital” on Sunday.
The asset had reclaimed $110,000 at the time of writing, but it faces more resistance just above this level.
