Bitcoin’s price journey through 2024 and into 2025 has been nothing short of remarkable. After a 30% correction following its all-time high in November 2024, BTC staged a powerful recovery in April 2025, ultimately surpassing previous peaks with a new record high in May. While many market observers anticipated a downturn based on traditional cycle patterns, on-chain data reveals a different story—one of resilience, accumulation, and long-term conviction.
This shift in holder behavior suggests that despite surface-level signals pointing to a potential market top, the underlying fundamentals remain strong. By analyzing key on-chain metrics such as Long-Term Holder (LTH) activity, the LTH-to-STH supply ratio, and Realized Cap HODL Waves, we gain deeper insight into Bitcoin’s current market phase and what it could mean for the rest of 2025.
Long-Term Holder Behavior Defies Historical Trends
One of the most reliable indicators of a market cycle peak is the spending behavior of long-term holders—those who have held their Bitcoin for more than 155 days. Historically, when LTHs begin distributing (i.e., selling) en masse, it often precedes a major market downturn. This pattern was evident in previous cycles, where two significant waves of LTH selling typically marked the end of a bull run.
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In early 2024 and again between November 2024 and April 2025, Bitcoin did see two distinct periods of LTH distribution. At first glance, this might suggest the cycle was nearing its end. However, instead of entering a prolonged decline, Bitcoin rallied to a new all-time high in May 2025—breaking from historical precedent.
This divergence highlights a crucial shift: long-term holders are no longer behaving like typical cycle-top sellers. Instead of offloading after price surges, they are holding firm, signaling stronger confidence in Bitcoin’s long-term value proposition.
Further reinforcing this trend is the LTH/STH supply ratio, which shows that long-term holders now control over 14 million BTC—the highest level ever recorded. In contrast, short-term holders (those holding for less than 155 days) possess fewer than four million BTC. This imbalance underscores a market dominated by patient capital rather than speculative trading.
In past cycle tops, the opposite was true: short-term speculation surged while long-term holders exited. Today’s environment reflects deeper maturity in the ecosystem, where investors are less reactive to price volatility and more focused on long-term holding strategies.
HODL Waves Reveal Strong Accumulation Momentum
Another powerful on-chain metric, the Realized Cap HODL Wave, provides a granular view of Bitcoin’s transaction age distribution. This indicator breaks down the supply based on how long coins have remained unspent, offering insights into investor sentiment across different time horizons.
Typically, when a market cycle ends, there is a surge in activity among younger coin age bands—especially those under three months. A spike in transactions within this group indicates widespread profit-taking and reduced conviction, often coinciding with market exhaustion.
Currently, however, coins aged under three months account for only about 30% of total market activity—far below the levels seen at previous cycle peaks. This suggests that despite the new all-time high, most recent buyers are not rushing to sell.
Even more telling is the movement between the 3–6 month and 6–12 month bands. Data shows a clear transfer of supply from the orange (3–6 month) band into the yellow (6–12 month) band. These coins were largely acquired during the January to April 2025 dip—a period of temporary weakness that attracted savvy accumulators.
The fact that these holders have not sold, even as prices reached new highs, demonstrates strong conviction. Rather than taking profits, they are effectively "graduating" into longer holding periods, reinforcing the narrative of sustained accumulation.
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This lack of profit-taking runs counter to classic cycle-top behavior and suggests that the current rally still has room to grow. When true distribution begins—especially from these mid-term holders—it will likely be accompanied by visible on-chain footprints. For now, those signals remain absent.
No Widespread Distribution—Yet
While there was notable LTH selling in late 2024, the same pattern has not repeated at current price levels. In fact, long-term holders have become relatively dormant during this latest surge, choosing preservation over profit realization.
This behavioral shift may be attributed to several factors:
- Increased institutional participation, which tends to favor long-term holding.
- Greater macroeconomic uncertainty, driving demand for hard assets like Bitcoin.
- Improved market infrastructure, reducing the need for frequent trading.
- Stronger network fundamentals, including adoption growth and technological advancements.
Additionally, those who bought during the early 2025 dip—often referred to as "dip buyers"—have also refrained from exiting their positions. Their continued holding further weakens the argument for an imminent market top.
Historically, cycles tend to end when both long-term and mid-term holders begin distributing simultaneously. That coordination has not yet materialized. Until we see sustained outflows from multiple age bands—particularly the 6-month and above cohorts—the case for a topping pattern remains unconvincing.
Frequently Asked Questions (FAQ)
Q: What defines a long-term holder in Bitcoin analysis?
A: A long-term holder (LTH) is typically defined as an entity that has held Bitcoin for more than 155 days without moving it on-chain. This threshold helps distinguish between speculative traders and committed investors.
Q: Why is the LTH/STH supply ratio important?
A: The ratio reflects the balance between patient capital (LTHs) and speculative capital (STHs). A rising LTH share usually indicates market strength and reduced selling pressure.
Q: How do HODL Waves help predict market cycles?
A: HODL Waves track how long coins have been inactive. A concentration in older age bands suggests strong conviction, while spikes in younger bands often signal profit-taking and potential tops.
Q: Does reaching an all-time high always mean a top is near?
A: Not necessarily. While psychological resistance can trigger pullbacks, new highs driven by accumulation—not distribution—are often signs of ongoing bullish momentum.
Q: Can on-chain data alone predict price movements?
A: On-chain metrics provide valuable context but should be combined with macroeconomic trends, technical analysis, and sentiment indicators for a comprehensive view.
Q: What would signal a real Bitcoin market top?
A: True cycle peaks are confirmed by widespread distribution across multiple holder groups, elevated MVRV ratios, exchange inflows, and declining hash ribbon momentum—all occurring simultaneously.
Conclusion: Conviction Over Capitulation
Despite reaching new all-time highs in May 2025, Bitcoin’s underlying holder dynamics suggest the market cycle is not yet mature. The absence of broad-based distribution—from both long-term and recent dip buyers—points to sustained conviction rather than speculative excess.
Key indicators like LTH dominance, low short-term turnover, and inter-band migration in HODL Waves all support the idea that this cycle is structurally different from prior ones. With fewer signs of euphoria and more evidence of strategic accumulation, Bitcoin may still have room to run before entering its next major consolidation phase.
As always, markets evolve, and vigilance is essential. But for now, the data tells a clear story: Bitcoin’s strength lies not in its price alone, but in who is holding it—and their unwillingness to let go.
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