Short-term holders are becoming fewer in the market, and that’s a good thing.

Today we can see that the share of supply held by STH is clearly shrinking, broken down as follows :

< 1d : 1.2%

1d - 1w : 2%

1w - 1m : 5.6%

1m - 3m : 6.7%

3m - 6m : 8.1%

—> This is a very interesting trend that we see at the end of every bear market.

• On one hand, it highlights that LTH are growing in number.

As you know, BTC held by LTH are less inclined to move, unlike STH, which stay very active in the market and are quite sensitive to its fluctuations.

• On the other hand, it suggests that demand hasn’t returned yet.

Every BTC purchased creates a new STH UTXO, so when demand becomes strong, we see a sharp increase in the share of supply held by STH, which eventually marks a market top.

It’s all a matter of balance, and to put the odds in your favor, you need to position yourself when disinterest is high and STH are becoming fewer.

Today this balance is reaching a negative extreme, whch is a positive sign.

Written by Darkfost