The number of coins held by short-term Bitcoin holders has been decreasing since late May, indicating waning demand, according to analysts at blockchain data analytics firm CryptoQuant.
Julio Moreno, head of research at CryptoQuant, said in an interview with "The Block": "The fact that short-term holders are not accumulating may mean that demand for Bitcoin remains weak." He added that in the face of such short-term holders of capitulation, long-term holders are accumulating Bitcoin.
If demand for Bitcoin grows again, Moreno said, this dynamic could reverse itself, "causing short-term holders to buy from long-term holders." CryptoQuant analysts further highlighted a number of charts showing clear changes in Bitcoin holding dynamics, showing that short-term holders (those addresses holding for less than 155 days) have significantly reduced their positions, especially throughout July. and August.
Source: CryptoQuant
IT Tech, a certified author on the CryptoQuant platform, said that this dynamic could lead to higher Bitcoin prices and market stability in the medium term. Accumulation by long-term holders could stabilize the price and prepare the market for a potential rebound, while selling by short-term holders could put short-term downward pressure on Bitcoin prices.
IT Tech said the data shows clear fund flows from weak hands (short-term holders) to strong hands (long-term holders), indicating consolidation in the market that may affect future price movements.
A chart mentioned by IT Tech shows that many short-term investors have exited the market in the past two weeks, with some taking profits and others experiencing losses. According to IT Tech, the red areas on CryptoQuant’s short-term holders’ net position chart indicate that these groups of investors “have become less confident due to market volatility and are trying to reduce risk.”
Source: IT Tech
In contrast, IT Tech has observed an increase in the net position of the long-term Bitcoin holder group, which they view as an opportunity for growth, "may indicate that long-term investors are currently investing in expectations of future growth." The price level is regarded as an accumulation opportunity."
Source: IT Tech
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