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Bitcoin has reached a landmark moment in its history earlier today, crossing the $100,000 price mark for the first time and cementing its position once again as the largest cryptocurrency by market capitalization.
As it stands, BTC all-time high is at roughly $103,679. This significant achievement has prompted a detailed analysis of its supply distribution, offering valuable insights into the behavior of long-term and short-term holders and the broader implications for the Bitcoin market.
Supply Distribution and Market Behaviour
Amid the excitement of Bitcoin’s new all-time high, an analysis from CryptoQuant’s analyst, Crazzyblockk, sheds light on how this milestone impacts the cryptocurrency’s realized cap and the broader market structure.
While the milestone reflects growing global adoption and investment confidence, it also raises questions about the potential trajectory of the market.
According to the analysis, Bitcoin’s supply is currently divided between two key groups of holders: long-term holders (LTHs) and short-term holders (STHs).
CryptoQuant data reveals that out of Bitcoin’s total supply, over 14.5 million BTC are held by LTHs, while nearly 5 million BTC are in the hands of STHs. Despite the price surge, only 52% of Bitcoin’s realized cap is attributed to STHs, a stark contrast to previous market peaks where this figure typically exceeded 80%.
Historically, Bitcoin’s realized cap trends reveal distinct behaviors during market cycles. During bear market phases, most realized cap shifts towards LTHs as accumulation intensifies, signaling the end of the bearish trend.
Conversely, during bull market peaks, the realized cap tends to be dominated by STHs, driven by speculative trading and short-term profits. However, the current distribution shows a higher concentration among LTHs, indicating a deviation from traditional market patterns.
Implications for Bitcoin’s Market Momentum
According to the CryptoQuant analyst, the relatively low realized cap held by STHs in the current market cycle suggests reduced selling pressure, which may support sustained price growth.
The analyst revealed that with a significant proportion of Bitcoin held by LTHs, market confidence appears strong, potentially providing a buffer against abrupt price corrections. This stability is crucial as it reflects long-term investor trust and reduces the likelihood of speculative volatility.
In addition, the analysis also highlights that this supply distribution aligns with a long-term bullish outlook for Bitcoin. The reduced participation of STHs in the realized cap indicates room for further upward movement as more capital may enter the market without triggering a significant sell-off.
The analyst wrote:
In conclusion, Bitcoin reaching $100,000 is a historic achievement, but the current supply dynamics suggest the potential for further upward movement, given the stability provided by LTHs and the relatively low participation of STHs in the realized cap.
Featured image created with DALL-E, Chart from TradingView
