The importance of long-term and short-term holders for Bitcoin

Navigating the inherent volatility of the Bitcoin ecosystem requires understanding the behavior of its holders. While there are numerous subsets of Bitcoin holders and traders, two cohorts stand out as the driving forces behind most, if not all, of its market movements — long-term holders (LTHs) and short-term holders (STHs).

Any entity holding Bitcoin without moving it for over 155 days is considered a long-term holder, while short-term holders are those who have held onto their BTC for less than 155 days. This distinction might look arbitrary, but it’s not; it’s based on empirical data and a deep understanding of the Bitcoin ecosystem and the various forces influencing holders’ behavior.

Analyzing the activities and changes in these two cohorts can help provide a deeper understanding of the market. CryptoSlate has extensively researched these metrics to better explain and predict market movements. However, there has been a lack of a deep dive into these two cohorts and their importance.

In this report, CryptoSlate will explore the definitions and implications of long—and short-term holders. Exploring how these metrics are calculated and what they signify will allow us to provide a comprehensive understanding of their impact on the Bitcoin ecosystem.