Definition ∞ LTH Supply Distribution refers to the movement of Bitcoin from long-term holders (LTHs) to other market participants, often indicating a period of profit taking. Long-term holders are entities that have held their Bitcoin for an extended period, typically over 155 days. When these holders begin to sell, it signals a potential increase in circulating supply and selling pressure. This distribution pattern is a significant on-chain metric for market analysis.
Context ∞ News reports frequently analyze LTH supply distribution during bull markets, as it often precedes market corrections or local tops. A notable increase in this metric can suggest that experienced investors are realizing gains, which can impact short-term price action. Monitoring LTH supply distribution provides insight into the behavior of seasoned market participants and their outlook on current market conditions. It helps contextualize supply-side dynamics and potential shifts in market momentum.
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