According to Cointelegraph, Bitcoin (BTC) is experiencing pressure as long-term holders (LTHs) begin to sell, highlighting the need for institutional buying to sustain the recent price breakout. Data from Glassnode, an onchain analytics firm, indicates that LTHs, who typically hold BTC for at least 155 days, are reducing their exposure. This shift marks a significant change after months of accumulation, with a net position decrease of 245,000 BTC as of November 20, the largest 30-day reduction since April.
Crypto analyst Miles Deutscher has emphasized the importance of strong institutional buying, particularly through United States spot Bitcoin exchange-traded funds (ETFs), to counteract the selling pressure from LTHs. He noted that ETF flows must remain robust to prevent the market from being overwhelmed by LTH sell-offs. Recent data from UK-based investment firm Farside Investors shows that ETFs have experienced record net inflows, with over $770 million on November 20 alone. Despite these inflows, Deutscher's analysis suggests that they may not be sufficient to offset the selling activity from LTHs.
Glassnode further reports that Bitcoin holders are now seeing significant unrealized profits, which could lead to increased sell-side pressure. The market value to realized value (MVRV) metric, which assesses profitability, is nearing levels seen during Bitcoin's previous peak of $73,800 in March. With Bitcoin's price recently surpassing the $89.5k mark, investors are holding substantial unrealized gains, potentially prompting profit-taking. Glassnode notes that while the market often remains in an "overheated" state during bull runs, sustained capital inflows are necessary to absorb any sell-side pressure. The firm concludes that the current market dynamics could lead to extended periods of elevated metrics if supported by sufficient capital.
