Glassnode: Bitcoin Market Cycle Enters Final Stage Amid LTH Profit-Taking and Network Slowdown

The Bitcoin market is signaling a critical transition, as new analysis from blockchain intelligence firm Glassnode indicates a significant slowdown in network activity and a strategic shift among long-term holders. These combined factors suggest that the current market cycle may be entering its final stage, prompting investors to closely scrutinize evolving demand-side metrics and supply dynamics.

• Bitcoin’s on-chain transfer volume has significantly decreased.
• Long-Term Holders (LTHs) are realizing profits at an unprecedented scale since 2016-2017.
• This profit-taking introduces substantial selling pressure into the market.
• The current market cycle is notably protracted, with supply remaining profitable for 273 consecutive days.

Decreasing On-Chain Transfer Volume

A primary observation supporting this outlook is the tangible decrease in Bitcoin’s on-chain transfer volume. The monthly average of change-adjusted transfers has seen a notable decline, dropping approximately 13% from $26.7 billion to $23.2 billion. This reduction mirrors recent price corrections and could signify a broader ebbing of speculative interest. Analysts at Glassnode emphasize that a sustained fall below the annual average of $21.6 billion would further corroborate a weakening in demand and a wider contraction across the network, as noted in their recent commentary: pic.twitter.com/gnyTokjzmA

Long-Term Holder Profit Realization and Market Pressure

Compounding these network signals is the observable behavior of Bitcoin’s long-term holders (LTHs). According to Glassnode’s data, LTHs are currently realizing profits at a scale unparalleled since the 2016-2017 market surge. This substantial profit-taking introduces considerable selling pressure, a hallmark of mature market cycles where early adopters and seasoned investors capitalize on their accumulated gains. Such actions are often indicative of a market progressing towards a phase of re-evaluation and potential consolidation.

Protracted Market Cycle Duration

Adding to this perspective, the current market cycle stands out for its protracted nature. Bitcoin’s supply has remained predominantly in profit for 273 consecutive days, marking it as the second-longest such period in the asset’s history. This extended phase of profitability is surpassed only by the 2015-2018 cycle, which lasted 335 days. This prolonged duration suggests a more gradual and sustained growth trajectory in the present cycle compared to its predecessors, potentially reflecting a maturing asset class.