Definition ∞ A short term holder in the cryptocurrency market is an entity that has acquired digital assets relatively recently, typically holding them for less than 155 days. These holders are generally more sensitive to price fluctuations and tend to sell their assets during market downturns or for quick profits. Their cost basis is usually closer to the current market price, making them more susceptible to realizing losses. Their activity often contributes to short-term market volatility.
Context ∞ The behavior of short term holders is a key analytical focus in on-chain metrics, often indicating immediate market sentiment. News reports frequently track their aggregate profitability and spending patterns to predict potential price movements. The discussion often contrasts their market influence with that of long-term holders, who exhibit greater price inelasticity.
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