Analyst: Short-Term Holder Supply Share Continues to Contract, May Reflect Bitcoin Is in Opportunity Zone

TechFlow reports that on August 14, CryptoQuant analyst Darkfost stated that the share of supply held by short-term holders (STH) in the Bitcoin market is declining significantly. The current distribution is: holding for less than 1 day accounts for 1.2%, 1 day to 1 week accounts for 2%, 1 week to 1 month accounts for 5.6%, 1 month to 3 months accounts for 6.7%, and 3 months to 6 months accounts for 8.1%. He believes this trend usually appears at the end of a bear market: on one hand, it indicates that the number of long-term holders (LTH) is increasing, with fewer coins in active circulation in the market; on the other hand, it also shows that new demand has not yet significantly returned.

Since every newly purchased Bitcoin forms a new unspent transaction output for short-term holders, when demand significantly strengthens, the share of supply held by short-term holders usually rises rapidly and ultimately corresponds to market tops. Currently, this balance is approaching a negative extreme, which may be seen as a positive signal.