- Bitcoin has reached a fork in the recovery process, or an extended accumulation phase.
- Long-term holders have been slow to buy BTC despite recent price drops, a reluctance that could spell trouble.
Bitcoin [BTC] continued to hold at the $61,000 support. News about BTC miners moving to Kaspa [KAS] could create more fear in the market, a recent AMBCrypto report found.
One analyst claimed that miners selling their assets to upgrade their hardware after the halving or for cash may not impact the market as heavily as expected.
So, are BTC holders ready for a rise in prices? Or will the selling pressure from elsewhere continue?
The lack of demand combined with the long-term behavior of holders raised concerns
ETF flows have been mainly negative over the past two weeks, with only the previous two days bringing some relief from selling pressure.
This indicated bearish sentiment for BTC among investors, but it is not yet clear whether that sentiment is starting to turn the other way or if this is a temporary reprieve before a new wave of selling.
Source: Axel Adler on X
Crypto analyst Axel Adler observed on X (formerly Twitter) that the change in supply among long-term holders has been minimal in recent weeks. This lack of LTH growth was a sign of pessimism across the market.
The supply of profits returns from the overheated zone
Source: Axel Adler on X
The analyst also pointed out that the earnings offer was at an inflection point. The optimism/pessimism threshold had been reached.
Over the past four years, whenever the supply of earnings fell below this point, the market would likely move toward an extended accumulation phase.
This would be accompanied by a price drop and could dampen the market’s positive expectations for BTC after the halving in May.
Source: CryptoQuant
The age ranges for issued production showed that there were large currency movements in late May and mid-June of 7-10 year old holders and 3-5 year old holders respectively.
Read Bitcoin’s [BTC] Price forecast 2024-25
This suggested that long-term holders were likely to sell and was a sign of a lack of conviction.
It does not guarantee further price drops, but it is a sign that the selling pressure has not yet abated.