Bitcoin’s rally is back — and the on-chain picture behind it is shifting.
After a weekend bounce that pushed BTC back above $73,000, investors are growing optimistic. But on-chain analytics show this cycle’s supply flows between long-term holders (LTHs) and short-term holders (STHs) are behaving differently than in past bull runs, a trend that could influence price action in the weeks ahead.
What’s changing
- Analyst Darkfost, in a post on X, says the transfer of supply from LTHs to newer market participants hasn’t followed previous patterns. Historically, large LTH sell-offs supplied buyers in the late-stage rally; this cycle, the dynamics have diverged.
- Crucially, LTHs still control the majority of BTC — about 79% of total supply as of Sunday — rather than seeing a rapid drop-off approaching cycle end.
- This mirrors parts of 2021, when LTH-held supply fell from 82% to 70% over six months, but the current cycle unfolded via six distinct waves of transfer, with STHs repeatedly stepping in to absorb supply and progressively becoming LTHs themselves.
Implications from the waves
- Darkfost highlights two takeaways: liquidity in this cycle appears ample, allowing LTHs to find counterparties more steadily as prices rose; and speculative behavior is higher than before, with some STHs selling soon after crossing the six-month holding mark to lock in gains.
- Earlier cycles were marked by inadequate STH liquidity to absorb LTH selling — a key trigger for sharp structure shifts — but this time STH demand has repeatedly absorbed supply across the six waves.
Institutional demand joining the picture
- New capital is arriving via ETFs and Digital Asset Treasuries (DATs), suggesting renewed institutional confidence and adding another layer to the evolving market structure.
Market snapshot
- At the time of reporting, Bitcoin was trading around $73,815 after a 24-hour gain of just over 3%. Trading volume surged more than 77% over the past day.
Bottom line
The market is bullish and liquidity dynamics are different this cycle: long-term holders remain dominant, short-term buyers have been steadily absorbing supply (often converting into long-term holders), and institutional flows via ETFs and DATs are reinforcing demand. Together, these shifts could shape how the current Bitcoin rally plays out.
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