Old Bitcoin Investors Are Cashing out Creating Market Friction → Insights

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Briefing

The primary obstacle to a sustained price rally is persistent, high-volume selling from Bitcoin’s longest-term investors, a cohort known as Long-Term Holders (LTHs). This profit-taking behavior suggests that the market is in a distribution phase where veteran capital is systematically exiting into new demand. This constant overhead supply creates significant friction, causing rallies to stall immediately upon reaching key price levels. This dynamic is best proven by LTH exchange inflows, which have been running at double their normal rate, indicating a sustained distribution effort.

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Context

The average market participant is wondering why Bitcoin’s price struggles to maintain momentum after positive news or brief surges. The question is simple → Is the market running out of buyers, or is a large, hidden seller consistently capping the price? This on-chain data helps answer that by pinpointing the source of the persistent supply that is absorbing demand and creating a ceiling for the price.

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Analysis

The Long-Term Holder (LTH) Exchange Inflow metric tracks the amount of Bitcoin moving from wallets that have held the coin for at least 155 days and entering centralized exchanges. This indicator measures the selling pressure originating from the most experienced investors. A rise in this metric signals that veteran holders are realizing profits and moving their coins to a liquid venue for sale. The current pattern shows LTH exchange inflows are running at double their normal levels, a clear signal that this cohort is in a period of “peak spending”.

This persistent distribution means that every time the price attempts a breakout, it runs directly into a significant, pre-positioned wall of supply from investors whose average cost basis is much lower, around $37,915. The sheer volume of this selling → over 371,000 BTC liquidated since July → is sufficient to halt upward momentum and creates a powerful, self-fulfilling resistance zone.

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Parameters

Key Metric → Long-Term Holder Exchange Inflow (LTH Inflow) → Tracks Bitcoin moving from veteran wallets to exchanges for sale.
Spending Volume → Over 371,000 BTC Liquidated → The total volume sold by LTHs since July, confirming massive profit-taking.
Inflow Rate → Double Normal Levels → The current rate of LTH-originated coins moving to exchanges, indicating peak distribution.
Friction Zone → $108,000 to $108.5K Price Level → The price zone where LTH selling pressure is most concentrated, acting as a strong resistance.

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Outlook

The near-term market direction remains constrained until this persistent Long-Term Holder distribution effort subsides. The price will likely continue to struggle to break decisively above the key resistance zone until the available supply from veteran sellers is exhausted. This structural selling must be fully absorbed by new demand before a sustained, powerful rally can begin. A reader should watch for a confirming signal in the form of a sharp and sustained drop in the LTH Exchange Inflow metric, which would signal that the profit-taking wave has ended and the overhead supply is cleared.

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Verdict

Persistent, high-volume profit-taking by veteran investors is the single largest factor creating a supply ceiling and preventing a sustained Bitcoin breakout.

Long-term holder distribution, LTH spending, on-chain supply friction, whale profit taking, old coin movement, realized profit surge, market cycle distribution, overhead supply wall, veteran investor selling, persistent selling pressure, double normal inflow, cost basis resistance, Bitcoin supply dynamics, accumulation slowdown, cycle distribution phase Signal Acquired from → beincrypto.com