There is a particular kind of Bitcoin holder who only shows up when the noise gets loud.
They are the people who watched 2021 melt into 2022, who kept their keys anyway, who learned to live with the idea that the line on the chart can drop faster than their mood. When the price is ripping higher, they are treated like prophets. When price rolls over, they are treated like villains.
Over the past few weeks, the villain story has been everywhere, long-term holders are dumping, the old hands are cashing out, and the cycle is ending. The story makes emotional sense; it gives a clean reason for a messy market.
The problem is that the chain rarely gives clean answers, especially when big custodians are moving funds around.
On-chain analysts like Darkfrost have been watching “LTH supply change,” basically a way of tracking whether coins that have sat still for months are starting to move.
They see the dump coming to a close, as we saw the first small green candle since mid-July. CryptoQuant founder Ki Young Ju highlighted the end of long-term holder sell pressure on X, but can we be sure?
The data got spooked by a giant Coinbase shuffle
In late November, Coinbase moved large amounts of crypto between internal wallets as part of a planned migration. Coinbase said the transfers were scheduled, not related to a breach, and meant to rotate legacy internal wallets into new ones as a security best practice, with no impact to customer deposits or product uptime.
That matters because internal wallet migrations can look like real selling on-chain, coins move, age resets, dashboards light up, and people start drawing conclusions.
It is movement without a change in ownership.
So when analysts say they “fixed” long term holder data by isolating the Coinbase effect, they are trying to remove a giant operational fingerprint from the chart.
What the long-term holder signal is saying right now
The most careful takeaway from the adjusted charts floating around is simple: long-term holders appear to be easing off the sell button, and the shift is small.
That lines up with the broader idea that the market is trying to find a floor, but the confirmation is still thin. Even Glassnode, which uses an entity-adjusted cohort model and defines long-term holders using the ~155-day threshold, describes long-term holders as “heavy net distributors” at roughly 104K BTC per month in late October, in its Week On-Chain report, Lacking Conviction.
The same report also makes the key point traders forget in the heat of a drawdown, major expansions in Bitcoin’s history have tended to begin after long term holders shift from distribution into sustained accumulation, it is a regime change that takes time to prove itself.
Glassnode’s definition and methodology matter here too. Their documentation explains that the LTH, STH split is centered on 155 days, and that the metric suite is entity-adjusted, rather than a raw address count.
So the best way to read today’s “LTH stopped selling” narrative is as an early nudge, not a victory lap.
Even if long-term holders relax, ETF flows can still swing the week
There is a second reality sitting on top of on-chain behavior now, ETFs have turned Bitcoin into something closer to a daily mood ring for risk appetite.
A single big ETF day can also dwarf a modest shift in long-term holder behavior, such as the roughly $523 million one-day outflow from BlackRock’s iShares Bitcoin Trust, IBIT, in November.
These flows are not the same thing as an old holder selling coins, but they land on the same market, at the same time, in the same order book. That is why Bitcoin can feel calm on-chain and still trade like a stressed-out tech stock.
The macro backdrop is shifting, but it is still not “easy mode”
Bitcoin’s biggest rallies tend to happen when liquidity is rising, and buyers feel safe taking risks. That is why the Federal Reserve keeps showing up in crypto conversations, even when nobody wants it to.
In December, the Fed cut its target range by 25 basis points to 3.5% to 3.75%. Around the same time, the New York Fed announced it would begin purchasing Treasury bills under its reserve management program, with the first schedule totaling about $40 billion and purchases starting Dec. 12.
Those are plumbing moves, they help explain why risk markets can stabilize even when sentiment is bruised, and why the next few months could hinge on whether buyers step back in consistently.
Three paths from here, and what would confirm each one
- A real reset, then a recovery.
Long-term holder selling continues to fade; it stays that way for weeks, ETF flows stop bleeding and turn mixed to positive, and volatility cools. In that environment, Bitcoin often does what it does best, it bores people first, then it moves. - A wide, frustrating range.
Long-term holders reduce selling, but do not accumulate in a sustained way. ETFs stay choppy, and macro headlines keep flipping the market’s mood. This is the outcome where Bitcoin spends more time rebuilding confidence than breaking records. - Distribution returns, and the market tests patience again.
If long-term holder distribution ramps back up, and ETFs see another stretch of heavy outflows, the price can remain under pressure. Glassnode’s Week On-chain view points to key cost basis levels and highlights how overhead supply can cap rallies when conviction is low, in Lacking Conviction.
The human part of the chart
For the people who have held through multiple regimes, the most important change is rarely the one-day candle. It is the moment the urge to sell fades, and the urge to wait returns.
If long-term holders are truly stepping back from distribution, the market gets a little less fragile. It does not guarantee higher prices next week, it does not protect anyone from a macro shock, it does not erase the power of ETF flows.
It does something quieter.
It changes who is willing to be the marginal seller, and in Bitcoin, that is often how the next chapter starts.
