Originally published on: December 09, 2024
Bitcoin’s journey towards $100,000 has sparked a wave of selling among long-term holders, raising concerns among analysts about a possible market top. The recent offloading of 827,783 BTC, valued at approximately $82.6 billion, by wallets holding Bitcoin for at least 155 days has led some experts to predict a potential downturn in the market.
According to CryptoQuant contributor Maartuun, the significant sell-off by long-term holders could catch traders off guard and turn the market bearish when buy-side demand decreases. He likened the situation to a game of musical chairs, advising investors to enjoy the ride but be prepared for when the music stops.
While institutions like MicroStrategy have purchased large amounts of BTC and inflows into spot Bitcoin exchange-traded funds (ETFs) have increased, Maartuun emphasized that these purchases only account for 30% of the total sold by long-term holders. He also highlighted the surge in retail demand, which he claims has reached “yearly highs” based on CryptoQuant’s retail demand 30-day change chart.
Despite the sell pressure from long-term holders, Maartuun noted that Bitcoin’s resilience is also supported by retail involvement in futures trading, with Bitcoin Open Interest (OI) currently standing at $61.2 billion. However, he cautioned that indicators such as the sell-side risk ratio and net taker volume suggest a potential market top.
Bitbodata’s Long Term Holder realized price indicates an average gain of 400% for long-term BTC holders, with the current price at $99,203. Real Vision’s chief crypto analyst Jamie Coutts also raised concerns about liquidity conditions, warning that a deteriorating backdrop could lead to a short-lived rally.
As Bitcoin continues its ascent, investors are advised to conduct their own research and exercise caution before making investment decisions. Stay informed about the latest market trends and insights to navigate the ever-changing crypto landscape effectively. Don’t miss out on valuable opportunities – subscribe to the Markets Outlook newsletter today for critical market analysis delivered weekly.
