Bitcoin Hodlers Rejoice: Long-Term Owners Are Finally Profiting Says Analytics Firm

Data from blockchain analytics firm Glassnode revealed long-term holders ("hodlers") of Bitcoin BTC/USD are currently profitable, marking the first time in nearly a year.

Glassnode's seven-day average of Bitcoin's long-term holder spent output profit ratio (LTH-SOPR) has crossed above 1, indicating that coins moved on-chain are being sold at a profit.

The LTH-SOPR focuses on coins moved on-chain that have a lifespan of at least 155 days, reflecting macro market shifts more accurately.

Historically, renewed profitability for long-term holders has presaged major market rallies, with previous crossovers dated May 2020, May 2019 and November 2015 coinciding with recovery rallies that eventually translated into multi-year bull runs.

Also Read: Stablecoin Wars: USDT Dethrones USDC On Polygon As Gaming And NFTs Skyrocket

While the ratio's crossover above zero might imply a positive market cycle ahead, it could also create resistance and slow down the cryptocurrency's rise in the short term.

Meanwhile, the sharp rise in Bitcoin held on Binance, one of the largest cryptocurrency exchanges, might be bad news for the market, according to Markus Thielen, head of research and strategy at Matrixport.

He suggested that "large amounts of Bitcoin being moved onto exchanges generally means that those are ready to be sold" and the awakening of legacy wallets that have not been used for 10 years could be a sign that long-term holders think prices might be capped around $30,000.

Read Next: Coinbase Warns SEC: Don't Mess With Crypto's Big Dog

Photo: Shutterstock