On April 2, industry analytics provider Glassnode reported that long-term holders have started distributing BTC and selling to new investors at higher prices.
“This represents an injection of new capital into the asset class, driving the realized cap up to new heights,” it added.
Realized cap is a measure of cumulative USD liquidity ‘stored’ in the asset class.
As the #Bitcoin Spot Price consolidates below the new ATH of $73k, the Long-Term Holder cohort has entered their distribution phase, selling to new investors at higher prices.
This represents an injection of new capital into the asset class, driving the realized cap up to new… pic.twitter.com/gGECO2oyyt
— glassnode (@glassnode) April 2, 2024
BTC Correction at 10%
However, the analysis was made as Bitcoin approached its all-time high for the second time and before markets began to retreat this week. BTC hit a peak price of $73,734 on March 14, pulled back around 17%, and returned to $71,550 on March 28 before resistance proved to be too strong.
It retreated just below $65,000 during the Wednesday morning Asian trading session, dropping to $64,573 before recovering to $66,300 at the time of writing, according to CoinGecko. BTC is currently 10% down from its ATH.
Nevertheless, Glassnode revealed that the realized cap also reached a new all-time high of $540 billion “and is increasing at an unprecedented rate of over $79 billion per month.”
Using the Realized Cap HODL Wave metric, Glassnode analyzed the distribution of USD-denominated wealth held across various age bands.
There has been a sharp increase in coin-ages younger than three months, it noted before adding that “these newer investors now own around 44% of the aggregate network wealth.”
It concluded that there has been a “distinct shift in investor behavior patterns.”
“Long-Term Holders are well into their distribution cycle, realizing profits, and re-awakening dormant supply to satisfy new demand at higher prices.”
The realized cap is climbing “because old coins are revalued higher, both from GBTC (~30%) and the rest by HODLers selling,” said Glassnode analyst ‘Checkmatey.’
There was a time when a chorus of #Bitcoin analysts were banging on about unrealistic 100x multiplier effects per dollar invested.
I proposed it was much closer to 5x, and up to 10x only in low liquidity spikes.
Since Jan 2023, the #Bitcoin market cap is up about $1Trillion…
— _Checkɱate 🟠🔑⚡☢️🛢️ (@_Checkmatey_) April 2, 2024
Furthermore, Santiment reported that the belief that Bitcoin is in a bull market may not have “fizzled out significantly,” according to social sentiment.
Elsewhere on Crypto Markets
Total market cap is down 3% on the day to $2.65 trillion, which is around 15% lower than its all-time high, which is still back in November 2021.
Aside from a handful of pumped meme coins, altcoins have yet to move significantly in this market cycle.
Today, they are all in the red again, with Ethereum down 2% at $3,300, XRP losing 2.5% falling to $0.584, and Dogecoin dropping 3% to $0.185.
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