Recent market analysis shows a significant shift in Bitcoin capital flows from short-term holders (STH) to long-term holders (LTH).
Specifically, according to CryptoQuant analyst IT Tech, short-term investors have been selling their positions amid recent market volatility, while long-term investors continue to accumulate.
Current trends among short-term and long-term holders
CryptoQuant analysts said that the net positions of short-term holders have dropped significantly in the past two weeks. Many of these investors have exited the market, either taking profits or stopping losses, indicating uncertainty about the short-term price direction of Bitcoin.
IT Tech stressed that the decline in STH positions further illustrates the decline in risk appetite among these investors. This behavior reflects a general trend where less confident investors respond to price volatility by reducing their exposure.
In contrast, long-term holders appear to have seized the opportunity presented by recent market volatility. IT Tech’s analysis shows an increase in LTH net positions, suggesting that these investors consider current price levels attractive and worth adding to holdings.
IT Tech points out:
Accumulation as a Bullish Signal: The green area on the Net Position graph shows that LTH is increasing its holdings, which is a bullish sign for the market as LTH is generally seen as more stable and confident in its investments.
The analyst added that the increase in LTH net holdings is also indicative of a broader market trend where investors with a longer-term horizon are taking advantage of Bitcoin’s current valuation. By increasing their holdings, long-term holders are betting on future growth.
What capital shifts mean for Bitcoin
Regarding the overall impact of this capital transfer, IT Tech revealed that the shift from short-term holders to long-term holders has mixed prospects for the Bitcoin market. The analyst noted:
LTH Accumulation: Increased LTH accumulation could lead to price stability and a potential rebound in the market, while STH selling could create short-term downward pressure on BTC prices.
However, according to the latest data shown by IT Tech, the meaning of LTH accumulation seems to be what is winning in the market right now.
The analyst concluded: "The data shows that capital is clearly flowing from the weak side (STH) to the strong side (LTH), indicating market stability."$BTC
