Long-Term Bitcoin Holders Continue to Dump BTC Amid Prolonged Wait for $100K

Bitcoin faces resistance near the $97,000 level as long-term holders reduce their balances and network activity declines.

Bitcoin’s efforts to surpass $100,000 have encountered strong resistance from bears, resulting in increased volatility in recent days. On Monday, Bitcoin was rejected near $97,500, falling about $3,000 in just a few hours before stabilizing slightly above $95,000.

Today, Bitcoin continued its downward trend, dropping 1.9% to $93,940 on Tuesday. This price decline coincides with a noticeable reduction in long-term Bitcoin holdings, adding complexity to the market outlook.

Declining Long-Term Bitcoin Holdings

Recent data from IntoTheBlock reveals a significant trend: long-term Bitcoin holders have been gradually reducing their holdings. As of now, these holders—defined as wallets that have held Bitcoin for more than 155 days—control around 12.45 million BTC, the lowest level since July 2022.

This marks a decrease of nearly 10% in long-term holder balances during this cycle, a less severe drop compared to previous market corrections. In 2021, long-term holders reduced their balances by 15%; in 2017, the decline reached 26%.

This trend suggests that Bitcoin holders are either selling off for profits or shifting their holdings to alternative storage options like cold wallets or exchanges. 

Bitcoin long-term holders are gradually reducing their balances, now holding 12.45 million BTC—the lowest level since July 2022.

So far, this decline is less severe than in past cycles. Long-term holder balances have fallen by 9.8% this cycle, compared to 15% in 2021 and 26% in… pic.twitter.com/eA5Cckrgs4

— IntoTheBlock (@intotheblock) December 3, 2024

Shrinking Network Activity

Alongside the decrease in long-term holdings, Bitcoin’s network activity also shows a notable decline. IntoTheBlock’s data highlights that the number of new Bitcoin addresses in the last seven days dropped by 5.94%. Active addresses, which represent the daily users transacting on the network, have decreased by 1.25%. 

Furthermore, there has been a 10.50% reduction in addresses with zero balances over the same period. These declines in network activity suggest that Bitcoin may be experiencing user fatigue, which could be a result of ongoing market corrections or broader disinterest. 

US Government Moving Bitcoin Amid Passive Market

In related news, the U.S. government has resumed transferring Bitcoin after a nearly four-month hiatus. On Monday, a government-linked wallet moved 19,800 BTC to a Coinbase Prime wallet, valued at $1.92 billion at the time of transfer.

Despite some skepticism surrounding the move, analysts suggest that the transfer is more likely related to custody actions than asset sales. The US Marshals Service, which oversees Bitcoin-related assets seized by the government, selected Coinbase Prime as a custody provider earlier this year.