Bitcoin Dips as Long-Term Holders Cash Out

After Donald Trump’s victory at the polls earlier this month, the trend has turned toward a decline, marking the longest dip so far under the current rally for Bitcoin. Following the near-approach to the $100,000 mark, Bitcoin priced itself below $93,000 after recording a 5% drop in just 24 hours but soon recovered as the trend carried forward to see prices above $94,200 early on during those Asian trading hours on Tuesday.

The overall cryptocurrency markets also saw their faces turn down in tandem, taking losses of 3.8% against the same 24-hour period.

Profit Taking by Long-Term Bitcoin Holders

With Bitcoin setting record highs, many long-term investors have begun cashing in on their profits. Glassnode statistics indicate that selling pressure from these holders touched an all-time high since April 2024, particularly emanating from the 6-12 month holding cohort, which has been averaging daily exits of 25,600 BTC, thus adding to the latest wave of sell-offs.

Based on average costs incurred during acquisition, these holders bought Bitcoin at a 71% lower average cost basis than the current market price, approximately $57,900, while pegging profit from Bitcoin moving up from $74,000 to $99,000.

Spot Bitcoin ETFs Absorb Market Sell-Offs

Spot Bitcoin ETFs have absorbed much of the sell pressure, with inflows since the election in the U.S. exceeding $7 billion. This has put total assets in U.S.-based spot Bitcoin ETFs at just over $105 billion.

Even so, fluctuations continue. For example, a net outflow of $438 million was recorded on the day of November 25 for U.S. Bitcoin spot ETFs, with Bitwise’s spot Bitcoin ETF suffering the most with an outflow figure of $280 million. Meanwhile, BlackRock’s IBIT recorded a net inflow of $267 million, according to SoSoValue data.

Although Bitcoin seems dynamic, the markets are still adjusting as the traders take profits and the ETFs harmonize their levels with the increased demand.