Analysts at crypto exchange Bitfinex have noted a significant shift towards spot trading for Bitcoin, driven by long-term BTC holders sticking with their accumulation strategy despite unfavorable market conditions.
According to the latest edition of the Bitfinex Alpha report, long-term holders now own 80.34% of the total Bitcoin supply, equivalent to 15 million BTC. In comparison, assets with short-term holders have fallen to 19.34%. Analysts said this was a sign of strong commitment to holding assets.
Long-term holders remain in accumulation
As long-term holders continue their accumulation strategy, realized gains and losses for Bitcoin have been negligible. Bitfinex noted that realized profit and loss per BTC fell to its lowest level since 2019.
The current realized profit is $724 while the loss is $236, compared to April 2021 and May 2022 when the average profit and loss figures were $12,900 and $6,700, respectively. According to historical data, the decline in realized gains and losses suggests that the market is in a transition phase as Bitcoin shows pronounced volatility as the numbers decline to current levels.
“Given these current values, which are well below the profit and loss figures from the last cycle, most coin transactions are occurring around their original cost basis. “This paints a picture of a market where the dominant players are either experienced holders who are indifferent to price changes or traders who are fighting for a slightly advantageous position,” Bitfinex said.
An illiquid market
Additionally, Bitfinex analysts noted that the supply gap between long-term and short-term holders is significant, as, according to BTC’s history, the behavior usually occurs at the beginning of a bull market or in the transition phase where the market fluctuates for some time in an illiquid one Environment after a withdrawal.
As the crypto market remains illiquid, analysts expect spot transactions to play a crucial role in determining developments in the coming weeks and months.
Meanwhile, BTC and Ether saw a surge in open interest in the futures markets, with the total value of BTC on centralized crypto exchanges exceeding $8.7 billion, indicating impending volatility and mass liquidations for both short and long positions .
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