The recent correction in Bitcoin’s price has begun to affect the behavior of long-term investors. According to on-chain data, there is a significant increase in the transfer and sales activity of this investor group, which is seen as more resilient than before, to stock exchanges.
Long-Term Investor Profitability at Bottom
In the cryptocurrency market, recent data from on-chain analysis companies shows that long-term investors are selling at a loss on average. The indicator known as Long-Term Investor Spent Output Profit Ratio (LTH SOPR) is around 0.88, falling below the 1 level. This level was last observed towards the end of the 2023 bear market. SOPR below 1 means that long-term savings in the market are sold at a loss.
The annual average LTH SOPR continues to remain at 1.87. However, when the indicator drops below the critical threshold, it usually indicates that the pressure and stress in the market is starting to increase. While it is known that investors tend to maintain their positions even during volatile periods, this activity reflects a change in market dynamics.
Increasing BTC Inflows to Binance
It seems that a significant portion of long-term investors transfer Bitcoin to the Binance exchange. In recent weeks, daily stock market inflows have been nearly twice the annual average. Successive high-amount transfers suggest that especially large investors are turning to Binance, where liquidity is intense.
Binance stands out as a platform with high transaction volume and depth. It appears that large investors are actively changing positions or profit/loss management here. Increasing stock market activity shows that the classical buy-and-hold strategy is beginning to be replaced by more active risk management among long-term investors.
Possible Consequences in Market Structure
Long-term investors increasing their sales at a loss and transferring more assets to the stock exchanges indicates a transition period in the market structure. Although this trend does not always mean a mass selling wave, it is viewed as a signal that the pressure on the market is growing.
Historically, the relief or reversal of stress experienced by long-term investors has followed persistent base formations. Latest data indicates that the market is still in an adjustment phase. Increasing stock market inflows along with the negative profitability trend suggest that selling pressure may continue in the medium-term course of Bitcoin.
