The cycle distribution phase refers to a period within a market cycle where a digital asset’s ownership is transferred from strong holders to less experienced participants. During this stage, smart money investors begin selling their holdings to retail buyers, often at inflated prices. This typically follows a period of significant price appreciation and precedes a market decline.
Context
Recognizing a cycle distribution phase is vital for investors seeking to understand the broader market structure of cryptocurrencies. On-chain analytics often reveal increasing transfers from long-term holders to exchanges, signaling potential selling. This phase is a critical point for assessing market health and anticipating future price action, particularly for assets that have experienced substantial gains.
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