Bitcoin New Supply Surge: Long-Term BTC Holders Resume Buying Spree

Bitcoin is riding the bullish wave as the flagship digital asset surges and reclaims the $91,000 mark, a key level that previously acted as strong resistance against upside prior attempts. With BTC experiencing notable upward movements, investors and traders are demonstrating renewed interest in the asset as they purchase more coins.

A New Wave Of Long-Term Investors Accumulation Begins For Bitcoin

Previous heightened bearish pressure around Bitcoin led to a negative sentiment among investors, causing them to close their positions. However, with BTC slowly recovering its upward trajectory, these investors are beginning to reenter the market as the asset reclaims key price levels that stood against previous upside attempts.

After months of market hesitation, Alphractal, an advanced investment and on-chain data platform, revealed that Bitcoin long-term holders are making their presence felt once again in the market. Bitcoin’s long-term holders’ growing interest in BTC reflects strong optimism and confidence in its future price performance.

Historically, increased participation among long-term investors is sometimes followed by notable price momentum, thus, this shift could be good for the cryptocurrency market. As BTC hovers near key resistance areas, it might pave the way for the next major leg-up for the flagship asset should this trend continue.

Alphractal highlighted that long-term holders are gaining more space in Bitcoin’s overall distribution as their supply is rising again. Following an investigation of the 1-year change in LTH Accumulation vs. Distribution metric, the platform noted that long-term holders are back in accumulation mode. The rise in buying activity from these investors can be seen as a long-term bullish signal, particularly in light of the current macroeconomic uncertainty around the world. 

On-chain data shows that long-term holders have currently acquired about 14.39 million BTC, representing over 72.48% of the overall supply. Meanwhile, short-term holders have accumulated 5.46 million BTC, representing about 27.48% of the overall supply in the market.

According to Alphractal, while the development may seem very optimistic for short-term price action at first, it might also be accompanied by downward pressure, considering past scenarios that led to negative pressure. This is due to the fact that short-term holders’ supply typically corresponds more closely with current demand and price fluctuations.

Short-Term Investors’ Pessimism Grows As They Keep Shorting BTC

In another post on the X (formerly Twitter) platform, Alphractal reported that retail or short-term traders are choosing to short BTC even as the asset moves toward the upside. Such behavior from these investors implies waning conviction and confidence in Bitcoin’s short-term prospects.

With retail traders opting for downside potentials, this increases the possibility of a short squeeze, which is the mass liquidation of short positions. However, if interest in long positions picks up again, a local top for BTC may occur in the short term.