Bitcoin HODL Waves Show HODLers HODLing

On-chain data shows that confidence in Bitcoin is not only strong, but growing, among long-term holders.

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The Bitcoin HODL waves chart indicates that long-term bitcoin owners are not only holding onto their coins, but increasing their stashes, even as price increases.

About HODL Waves

The HODL waves concept was developed by Dhruv Bransal from Unchained Capital.

The chart uses on-chain data to analyze and visualize the percentage of total bitcoins in existence that have moved within given age bands, starting in the last 24 hours and moving up to a ten-year band. Over time, as coins are bought, sold, and held, they move into different bands.

The chart gives a broad picture of confidence in bitcoin by different investor/trader types. Comparing changes in the "waves" with bitcoin's price provides insights into how bitcoin holders react to market developments. For example, the blow-off peaks of bull runs in 2013, 2017, and 2021 saw an increase in the percentage of shorter-term holders, as long-term holders sold coins.

HODL Waves Insights

The chart above provides a number of interesting insights. For example:

  • The percentage of coins held for 7+ years has never decreased, and the percentage held for 5+ years has hardly ever decreased. "Diamond hands" are growing as a cohort.
  • The percentage of one-year-plus holders began in increase significantly after the peak of the last bull market, in November 2021.
  • The supply of coins that has not moved for at least two years started to increase sharply in November 2022 (as the one-year category "graduated" into the next cohort).
  • This indicates that a large number of people bought before the bull market really got going, held right through the peak, and continue to hold now.
  • The percentage of coins held for over 6 months is at an all-time high.

Blockchain analytics firm Glassnode supplies more information, drawing attention to the increase in supply controlled by long-term holders (defined as 1+ years).

According to Glassnode, Bitcoin has been in a "HODLing regime" since November 2021, with accumulation rather than distribution being the trend. Aggressive accumulation took place following the first peak of the 2021 bull market.

All of this builds a solid foundation for the next bull run. If previous market cycles are any indication (and bear in mind that past performance does not always indicate future performance), the next aggressive distribution phase may not start for another 16 months, a year from the next cycle peak.

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