Bitcoin: Analyzing Divergence In Investor Behavior – Who’s Buying And Selling BTC?
The Bitcoin price started the week on a strong footing, jumping back above $90,000 following the announcement of a strategic crypto reserve by US President Donald Trump. However, the flagship cryptocurrency barely sustained this momentum, dropping back beneath the $90,000 level before midweek.
The recent market uncertainty is mirrored in the Bitcoin action, as the price has moved mostly sideways (after the initial pump) within the $82,000 – $92,000 range. The question now is — who is behind the constant price retracement and consolidation?
Short-Term Sell-Offs Meet Long-Term Confidence: Analyst
In a Quicktake post on the CryptoQuant platform, an analyst with the pseudonym ShayanBTC discussed the divergence in investor behavior while using on-chain data to evaluate current market sentiment. The relevant on-chain indicator here is the Spent Output Age Bands (SOAB) metric, which sorts spent coins into categories depending on their age and as a proportion of total coins moved.
ShayanBTC specifically analyzed the bags of investors between the 1-week and 6-month cohorts (short-term holders) using the Spent Output Age Bands. Data from CryptoQuant shows that the selling activity of short-term investors drove the recent Bitcoin downturn.
These investors, known for their rapid reactions to market fluctuations, have been actively depositing BTC onto exchanges — which can be associated with selling pressure. Considering the sensitive nature of short-term holders to market sentiment and technical resistance levels, their selling behavior aligns with Bitcoin’s recent struggle to sustain any bullish momentum.
Source: CryptoQuant
On the other hand, long-term investors (those holding BTC for more than 6 months) have shown no signs of capitulation. While some level of profit-taking can be seen among this group of Bitcoin holders, it seems to be rather gradual and consistent with the behavior seen in healthy bull markets rather than mass liquidations.
The activity of long-term Bitcoin investors suggests that they anticipate future price appreciation before offloading larger portions of their holdings, thereby reducing the BTC supply in the open market. ShayanBTC added that “if sufficient demand enters the market, this supply shrinkage could fuel further price appreciation.”
Interestingly, the latest on-chain data shows that Bitcoin’s long-term investors are not the only market participants refraining from offloading their assets. Crypto pundit Ali Martinez revealed in a post on X that the BTC miners have recorded zero selling activity since February 28.
Bitcoin Price At A Glance
As of this writing, the premier cryptocurrency is valued at around $86,200, reflecting a mere 0.5% price decline in the past 24 hours.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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