Bitcoin Distribution Phase

Definition ∞ The Bitcoin distribution phase describes a market period where long-term holders or large entities begin selling their Bitcoin holdings. This phase typically follows significant price appreciation, as these participants realize profits. It is characterized by an increase in the supply of Bitcoin moving to exchanges, indicating a shift from holding to selling behavior. Identifying this phase assists in understanding potential market tops or periods of price consolidation.
Context ∞ News regarding Bitcoin’s market cycles often highlights the distribution phase as a critical indicator of impending price corrections or market plateaus. Analysts frequently examine on-chain metrics, such as exchange inflows and outflows, to assess the extent of selling by established holders. The current discussion revolves around identifying early signals of distribution to help market participants anticipate significant shifts in Bitcoin’s valuation trend.