Bitcoin Halving 85% Complete, Long-Term Holders’ Supply Nears All-Time High

The halving process for Bitcoin is reportedly 85% complete as of Monday, with the supply of digital tokens held by long-term holders (LTHs) approaching a record high, according to cryptocurrency expert @therationalroot. Historically, this trend has indicated the near approach of a market bottom in previous cycles, often followed by the commencement of a new cycle. The supply of Bitcoin held by long-term holders has consistently served as a reliable gauge of the digital currency market and has demonstrated an inverse correlation with Bitcoin’s long-term price movements.

The current halving cycle has exhibited similar sideways price behavior to previous cycles, with Bitcoin prices remaining relatively stable as the cycle nears its end. Notably, during this cycle, Bitcoin has shown an upward-biased sideways trend, contrasting with the previous cycle, which provided an additional buying opportunity due to the market crash triggered by the COVID-19 pandemic.

In addition to monitoring the halving progress, @therationalroot shared a chart depicting the supply of Bitcoin held by long-term investors. The chart indicated that the supply ratio held by LTHs is very close to its all-time high of 76%. Historically, whenever this indicator has peaked, it has been several months prior to a Bitcoin halving event. Following these peaks, the supply held by LTHs typically decreases gradually before stabilizing for several months post-halving.

This trend suggests that long-term holders become increasingly willing to sell their assets for profit at the conclusion of a bull market, driven by rising Bitcoin prices. Conversely, during a bear market, LTHs tend to hold onto their assets when the market hits its lowest points. The greatest accumulation of Bitcoin among LTHs occurs during these bear markets, as seasoned investors often refrain from selling amid falling prices.

Looking ahead, the upcoming Bitcoin halving in mid-2024 is generating significant interest from investors. If historical patterns hold true, the cryptocurrency market may undergo approximately one year of sideways movement. The mid-April 2024 halving is unlikely to have an immediate impact on Bitcoin prices, with any significant effects potentially manifesting in the final quarter of 2024 and into 2025.

Meanwhile, analyst Rekt Capital has suggested that Bitcoin could enter an 18-month bull market following the April 2024 halving. Based on historical trends, Rekt Capital predicts that Bitcoin may peak around mid-September or mid-October 2025. However, he cautions that Bitcoin might experience a downturn leading up to the halving, potentially revisiting its macro higher low near $20,300 by mid-February 2024. As of Monday, Bitcoin is valued at approximately $26,258, indicating a possible over 22% decline based on Rekt Capital’s projected downside target.

This article was generated with the support of AI and reviewed by an editor.