BTC short-term holders ‘likely taking on more risk’ as realized cap drops by $6B

Short-term holders seem to be turning bullish on Bitcoin (BTC) as Q4 2024 begins, despite concerns that October is not off to a flying start. Over the past seven days, short-term holders realized capitalization has jumped by $6 billion.

Bitcoin STH realized cap sees “sharp increase”

Short-term holders — those who have held their Bitcoin for less than 155 days —  are “likely taking on more risk or increasing their buying positions,” CryptoQuant contributor Amr Taha argued in an Oct. 5 analyst note.

He pointed out that the seven-day change in STH realized cap — an onchain metric that values each Bitcoin based on the price it was last moved — moved from -$17 billion to -$11 billion, representing a $6 billion “sharp increase” in the cohort’s Bitcoin value. The large spike in buying activity signals a more positive sentiment among STHs as the crypto market transitions from Q3 to Q4.

However, Taha also pointed out that while short-term holders seem more optimistic, data suggests that long-term hodlers may be taking the opportunity to sell some of their holdings.

Over the same seven-day period, long-term holders — entities hodling coins for at least 155 days — realized cap saw a “sharp decrease” of $6 billion, “suggesting that long-term holders are likely taking profits or closing buying positions.”

Related: Bitcoin is again forming a ‘three blind mice’ trading pattern: Peter Brandt

Analysts split on Bitcoin’s next move

Despite October historically being one of Bitcoin’s strongest months, analysts are divided on how it will perform this month.

“Bitcoin is currently showing initial signs of a short-term dip,” pseudonymous crypto trader Rekt Capital opined in an Oct. 5 X post.

However, other analysts are more bullish on the longer-term view of Bitcoin’s price.

“While many are focused on short-term price action, the 3-month chart looks incredibly bullish,” pseudonymous crypto trader Mags declared in an Oct. 5 X post, pointing out that it just closed another 3-month candle above the 2021 all-time highs.

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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.