Long-term holders (LTH):.

- Long-term holders are individuals or entities that hold onto their

Bitcoin for an extended period, typically over a year.

- Long-term holders usually adopt a buy-and-hold investment strategy,

believing in the long-term potential of Bitcoin.

Short-term holders (STH):.

- Short-term holders are those who buy and sell Bitcoin within a shorter

timeframe, typically less than a year. This group often includes traders

who engage in frequent transactions to take advantage of short-term

price movements.

- Short-term holders often employ trading strategies like day trading,

swing trading, or scalping to capitalize on market volatility.

STH and LTH Behavior:.

STH Realized Cap Changes (orange area):,

- Increases above 6B typically correlate with short-term holders

realizing small gains during price rises or buying at the market top.

- Decreases below -6B indicate short-term holders realizing losses or

selling during price declines (panic selling).

LTH Realized Cap Changes (blue area):.

- Increases above 6B typically correlate with long-term holders realizing

small losses during price declines or buying during price dips.

- Decreases below -6B indicate long-term holders realizing gains or

selling during market tops (taking profits).

Green Rectangles:.

- Often correspond with periods where the price dips and LTHs are

accumulating, taking advantage of lower prices to increase their

holdings.

Red Rectangles:.

- Correlate with significant price movements where STHs either take

profits during spikes or panic sell during drops.

Conclusion:

The chart provides a clear visualization of how different types of Bitcoin holders react to price changes. Long-term holders (LTHs) tend to accumulate during price declines, indicated by the blue areas and supported by the green arrows and rectangles. Short-term holders (STHs) selling at losses during declines, as shown by the orange areas and red rectangles.

Written by Amr Taha