The recent price surge of Bitcoin (BTC) above the $100,000 milestone has coincided with a sharp decline in the supply held by its long-term holders. This trend suggests that some of the market’s most seasoned investors are booking record profits as BTC prices climb toward the six-figure mark.
Realized Profits for Long-Term Holders Hit Record Highs
The chart below illustrates entities that hold Bitcoin for more than 155 days, classified as long-term holders (LTH). Their behavior can often reflect a shift in market sentiment:
Total Bitcoin Supply Held by LTH
| Date | Total Supply |
| — | — |
| Dec 19 | $13.31 billion |
| Nov 20 | $14.23 billion |
According to Glassnode data, the supply held by LTH dropped to $13.31 billion as of Dec 19 compared to its local peak of around $14.23 billion two months ago. In the same period, BTC’s price has risen from approximately $58,000 to over $100,000, indicating that LTHs have been selling their holdings at local highs.
Bitcoin Uptrend Above $100,000 Far from Being Exhausted
Bitcoin’s short-term holders (STHs) are stepping in to absorb sell-side pressure from long-term holders. Notably, the LTH supply’s decline has coincided with the rise in the Bitcoin supply held by STHs. The ability of STHs to absorb this selling pressure has likely played a key role in sustaining Bitcoin’s price momentum above $100,000.
Total Bitcoin Supply Held by STH
| Date | Total Supply |
| — | — |
| Dec 19 | $8.45 billion |
| Nov 20 | $6.23 billion |
Market Sentiment: No Signs of Euphoria
According to Glassnode analysts UkuriaOC and CryptoVizArt, "The proportion of wealth held by these new investors has not yet reached the heights experienced during previous ATH cycle tops." They added that:
"The interpretation here is that the market may not have reached the level of euphoric fervor, and saturation by speculators seen in prior cycles."
Bitcoin Realized HODL Waves (24h-3 months)
| Date | 24h-1 month | 1-2 months | 2-3 months |
| — | — | — | — |
| Dec 19 | $10.45 billion | $12.23 billion | $14.31 billion |
Another useful metric to assess the state of the market is the True Market Deviation (AVIV Ratio), which measures the average unrealized profit – or paper gains – held by active investors.
AVIV Ratio Tops
| Date | Value |
| — | — |
| Dec 19 | 1.81 |
| Nov 20 | 2.31 |
Based on participants’ profitability, this ratio helps determine whether the market is overextended or still has room to run. Historically, bull markets tend to peak when nearly all investor categories achieve substantial profits. This scenario often results in overwhelming sell-side pressure, as investors lock in gains while new buyers hesitate to enter at elevated prices.
Market Not Yet Reaching Unsustainable Euphoria
The AVIV Ratio’s extreme band, defined as +3 standard deviations (σ), typically signals such overheated conditions. As of Dec 19, it stood at 1.81, well below the extreme band of +3σ (2.3). This suggests that while profits are rising, the market has not yet reached levels of unsustainable euphoria. Therefore, Bitcoin could continue to climb even higher before profit-taking and reduced demand create a real market reversal.
Mild Correction Predicted by Bitfinex
Analysts at Bitfinex exchange estimate Bitcoin correction to be mild in the coming months, stating that growing institutional demand will eventually propel BTC price to $145,000 by mid-2025 or $200,000 in the best-case scenario. As of Dec 19, Bitcoin exchange-traded funds (ETF) are currently managing a little over $37 billion worth of assets, compared to $24.23 billion at the start of November, according to Farside Investors data.
Bitcoin ETF Cumulative Net Flows
| Date | Total Assets |
| — | — |
| Dec 19 | $37.21 billion |
| Nov 1 | $24.23 billion |
Speculation on Strategic Reserve for US
Meanwhile, speculation is mounting within the crypto industry over the possibility that the incoming Trump administration could establish a strategic Bitcoin reserve for the United States, a move that could push the price toward $800,000 by the end of 2025.
Conclusion
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
Stay Ahead with Markets Outlook
Explore more articles like this by subscribing to our newsletter: Get critical insights to spot investment opportunities, mitigate risks, and refine your trading strategy.
