Bitcoin’s long-term supply hits record high as short-term supply declines: Bitfinex

On-chain metrics show that Bitcoin is experiencing a significant shift in investor volatility as supply shifts favor long-term holders.

According to the 75th edition of the Bitfinex Alpha Report, the long-term supply of bitcoins increased by more than one million bitcoins (BTC) as of April 13, 2023, while the short-term supply decreased by one million BTC. time.

Bitcoin sees a change in investor volatility

Bitfinex analysts define short-term holders (STHs) as investors who hold BTC for less than 155 days, while long-term holders (LTHs) hold the asset for 155 days or more. While STHs reduced their holdings from April 13 to today, LTHs increased theirs.

At one point, between September 25th and 26th, there was a massive drop of 200,000 BTC through STHs. During the same period, LTHs saw an increase of 200,000 BTC. Bitfinex analysts believe that this is a typical behavior of a group of investors who usually sell STHs to gain profit or mitigate losses, while LTHs increase their holdings by believing in BTC's long-term potential.

Due to dynamic changes, LTH supply is now at its highest level while STH supply has fallen to a level not seen in eight years. Bitfinex said the gap widened as BTC rallied to $28,500 earlier in the month as many STHs filled their positions and made small profits.

Bitcoin volatility increased for October.

Last week, Bitfinex reported that several market indicators indicated that a large group of investors were at the HODL stage, setting themselves up for a bull run. At this time, the crypto exchange thinks that Bitcoin will experience a higher level of volatility in October because the crypto asset started the month with a “bang”, with its 24-hour volatility increasing by more than 340% on October 2.

“As volatility flows from the US stock market into Bitcoin and other crypto assets, we currently see isolated high-volatility events on the rise, and this trend is likely to continue as historical volatility remains above key averages. Additionally, the options market is currently pricing in volatility similar to BTC,” he said. Bitfinex analysts said.

Meanwhile, BTC appears to be lagging behind major US indices. This is evident in the fact that the asset price has fallen from the 4200 point level before the S&P 500 reached its lowest level.