Bitcoin speculators are capitalizing on the recent surge in Bitcoin’s price, with short-term holders (STHs) eyeing potential selling opportunities. Despite their average profits totaling a modest 10%, STHs are increasingly sending their coins to exchanges at the $30,000 mark, according to data from on-chain analytics firm Glassnode.
Glassnode’s research reveals a spike in funds being put up for trade by STHs, who hold their Bitcoin for 155 days or less. The recent elation in Bitcoin price action has enticed these more speculative investors to interact with exchanges, resulting in an intensified flow of 35.4K BTC (1.28% of the STH supply) into exchange wallets.
Comparing current inflows to those seen during the 2022 bear market, it becomes evident that STHs tend to sell en masse during periods of price suppression, aiming to limit losses. However, during times of profit-taking, such as now and back in March when BTC/USD first reached $30,000, overall exchange volumes remain lower.
These findings highlight the fickle nature of speculative interest in Bitcoin, which is highly sensitive to even smaller price movements. Nevertheless, STHs have emerged as influential market forces in 2023. Their aggregate cost basis, which currently stands at around $26,500, has served as a support level so far.
On-chain analysis suggests that if BTC’s price continues to rise, the urge to take profit could become overwhelming. Historical data indicates that once STH profitability reaches 20%, selling tends to commence. Considering the current breakeven point of around $26,500, a significant shift in hodler composition could occur if Bitcoin surpasses $33,000.
At present, the profitability of STHs stands at approximately 10%, with their realized price (the price at which STH coins last moved) exceeding $27,000. These figures indicate that STHs are closely monitoring the market and making calculated decisions based on their profit margins.
It is important to note that this article does not provide investment advice or recommendations. Every investment and trading move carries risks, and readers should conduct their own research before making any decisions.