Or, Bitcoin long-term holders (LTHs) would start offloading their BTCs more aggressively. Given their unrealized profit margins are nearing 350%, this may drive BtC’s price as high as $99,900. In the past, LTHs have shown a propensity to sell when unrealized profit margins hit this type of threshold. This sort of behavioral psychology might create a psychological barrier at the $99,900 price point.
Long-term holders are investors who hold their Bitcoin for a period of no less than 155 days and through several market cycles. Historically, these holders have sold heavily once their unrealized gains hit 350%. Per the analysis of that data, the 350% profit level equates to BTC price of $99,900.
3 Unrealized profit margin, 350% When the unrealized profit margin hit 350%, it would nearly always be followed by a spell of consolidation or a correction.
Bitcoin has come a long way, going from an experimental digital currency to a widely accepted and valuable asset class. This is because the asset class has pulled in institutional and retail investors alike.
The following Glassnode chart depicts long-term holder behavior since December 2019. The chart highlights periods of Bitcoin accumulation by long-term holders, represented by green-shaded areas, and periods of intense selling pressure, indicated by red-shaded areas.
Historical data indicates that Bitcoin long-term holders are increasingly likely to convert into active sellers. That’s typically triggered by a 350% increase in their unrealized profit margins. Behavior that consistently results in overwhelming market consolidation or retreat.
Strong demand for Bitcoin would likely help absorb some of the selling concentration from long-term holders around the $99,900 price level. Absorbing this selling pressure would avert a significant price decline at that anticipated level.
