Bitcoin experienced its longest decline since its recent rally began, initially driven by renewed optimism earlier this month. After failing to sustain a push past $100,000, the cryptocurrency dropped below $93,000 before recovering to trade above $94,200 during Tuesday’s early Asian trading session. The broader cryptocurrency market mirrored Bitcoin’s movement, registering a 3.8% decline over 24 hours.
Long-Term Investors Lock in Gains
Data shows that long-term Bitcoin holders have been cashing out profits, contributing significantly to selling pressure. According to Glassnode, the selling activity among holders with 6-12 months of Bitcoin holdings has reached levels not seen since April 2024. This group averaged 25,600 BTC sold per day, often at a cost basis significantly below the current market price, turning substantial profits.
For many of these investors, Bitcoin’s recent rally from $74,000 to $99,000 presented a prime opportunity to lock in gains, with the cost basis for their holdings averaging 71% lower than the market price during the surge.
Spot Bitcoin ETFs Mitigate Selling Pressure
Spot Bitcoin exchange-traded funds (ETFs) have played a key role in absorbing the market’s selling pressure. Over $7 billion has flowed into U.S.-based Bitcoin ETFs since the recent market rally began, pushing total assets in these funds to an impressive $105 billion.
However, on November 25, U.S. Bitcoin spot ETFs faced net outflows of $438 million. Bitwise’s fund led the outflows with $280 million, while BlackRock’s IBIT ETF counterbalanced with a net inflow of $267 million on the same day, according to SoSoValue data.
As Bitcoin hovers near critical price levels, investor behavior continues to shape its volatile trajectory in the market.
Disclaimer: This content does not constitute trading or investment recommendations. It’s essential to conduct your own research before purchasing any cryptocurrency or investing in any services.
