On-chain data shows the Bitcoin HODLers are currently displaying net accumulation behavior, as they grow their holdings by 15,000 BTC per month.
Bitcoin Long-Term Holders Have Been Accumulating Recently
According to data from the on-chain analytics firm Glassnode, these investors were previously aggressively distributing during the bear market lows. The HODLers, or more formally, the “long-term holders” (LTHs), make up a Bitcoin cohort that includes all investors that have been holding onto their coins since at least 155 days ago.
The LTHs make up one of the two main holder groups in the market; the other cohort is called the “short-term holder” (STH) group and naturally includes only investors that bought their BTC less than 155 days ago.
Statistically speaking, the longer a holder owns a coin, the less likely they become to sell it at any point. This means that the LTHs are the more resolute bunch of the two groups, which is why they are called the “HODLers” or the diamond hands of the market.
As these investors are an important part of the sector, their movements can be worth tracking. An indicator called the “HODLer net position change” measures the monthly rate at which these investors are buying or selling a net amount of Bitcoin right now.
The chart below shows the trend in this metric over the last few years:
The value of the metric seems to have been green in recent months | Source: Glassnode on Twitter
When the HODLer net position change has a positive value, it means these investors are receiving inflows into their holdings currently. On the other hand, negative values suggest a net number of coins are exiting the supply of the LTHs.
As displayed in the graph, the Bitcoin HODLer net position change had a deep red value during the bear market lows that followed the November 2022 FTX crash. This means that the LTHs had been selling during this period.
This sharp negative spike has been an exception to the long-term trend, however, as the HODLers have actually been showing an overall strong accumulation behavior over the past couple of years. The last time these investors participated in consistent distribution was during the bull rally in the first half of 2021.
From the chart, it’s visible that after the aforementioned brief period of distribution at the bear market lows, the LTHs switched back to accumulation just before the current rally began.
These diamond hands have continued to add to their holdings throughout the rally so far, showing that they haven’t been allured by the profit-taking opportunity. This can be a bullish sign for the long-term sustainability of the rally.
Though, very recently, the monthly amount that they have been adding to their holdings has been trending down. Nonetheless, the indicator’s value still remains positive, as the Bitcoin LTHs are accumulating at a rate of 15,000 BTC per month currently.
At the time of writing, Bitcoin is trading around $29,100, up 1% in the last week.
BTC has seen some heavy fluctuations during the past day | Source: BTCUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, Glassnode.com