Definition ∞ Long term holder distribution refers to the allocation of a cryptocurrency among investors who have held their assets for an extended duration. This metric analyzes the proportion of a digital asset’s total supply that is held by entities typically defined as long-term holders, often based on holding periods exceeding several months or a year. It provides insight into the conviction and accumulation trends of seasoned investors. A high and stable long-term holder distribution often suggests a strong underlying belief in the asset’s future value. Significant changes can indicate shifts in market structure or sentiment.
Context ∞ Crypto news often examines long term holder distribution to assess the health and maturity of an asset’s market. A decreasing distribution might signal that long-term holders are selling, potentially leading to increased supply and downward price pressure. Conversely, an increasing distribution suggests accumulation by confident investors, which can be a bullish indicator. This metric helps differentiate between speculative trading and fundamental investor conviction.
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