After (BTC) hit a new all-time high of $108,365 on the 17th, it subsequently experienced a massive correction of nearly 15%, with the lowest point reaching $92,268 on the 21st. However, has shown a relatively strong rebound in the past 24 hours, currently trading at around $98,085.
The Degree of Correction During the Bull Market Uptrend is Weakening
Regarding the selling pressure that led to 's 15% correction in the past week, analyzed in the latest weekly report that "although price corrections are typically accompanied by extreme selling pressure after significant price increases, the severity of market pullbacks during the bull market uptrend has been declining as the market size has grown."
The report stated that the deepest decline this cycle was -32%, occurring on August 5th this year. Most declines only caused prices to drop 25% from local highs, indicating that this cycle has been one of the least volatile so far. This phenomenon may reflect the significant demand brought by spot ETFs and the growing interest of institutional investors.
Long-Term Holders Have Realized Profits of $2.1 Billion to a New High
Furthermore, due to the consecutive weeks of prices above $100,000, long-term holders are taking the opportunity to redistribute their supply to new demand. This has allowed the realized profits of the long-term holder group to reach a new all-time high of $2.1 billion recently.
Assuming a simplified assumption that each seller is matched with a buyer, this observation can provide some insight into the strength of the demand side, which may represent the market providing approximately $2.1 billion in new capital.
Wealth Redistribution
Meanwhile, tokens aged between 6 to 12 months have dominated the current selling pressure, realizing $27.3 billion in profits since last November, accounting for 38.5% of the overall. In contrast, tokens older than this period remain relatively dormant.
The above data also shows that the wealth proportion of new investors has risen significantly, highlighting the strong demand conditions and reflecting the wealth redistribution from long-term holders to new investors during the bull market.
However, the network wealth proportion held by these new investors has not yet reached the peak levels experienced during the previous ATH cycle. The explanation here is that the market may not have reached the level of exuberance and saturation experienced by speculators in the previous cycle.
The Bull Market Has Not Yet Reached Its Peak
Finally, the report observed the AVIV ratio, an indicator that helps assess the average unrealized profits (paper gains) held by active investors in the market, to gauge whether the market's profitability relative to participants is overheated.
Typically, when all investor classes have achieved substantial profits, the bull market will end, leading to significant supply-side pressure and a severe lack of new investors willing to buy at current prices.
Currently, the AVIV ratio has not reached the extreme +3σ range, indicating that the market may still have room to operate before the profits held by ordinary investors become too tempting.
Conclusion: The Current Market May Have Reached the Late Stage of the Bull Market
In conclusion, the report states that as long-term holders continue to actively distribute tokens on a large scale, the supply-side forces have become increasingly prominent, realizing an impressive $2.1 billion in realized profits. However, the strong demand side is also evident, largely offsetting the massive selling pressure from existing holders.
Furthermore, the significant increase in the network wealth proportion held by new investors supports the concept of strong demand. However, this indicates that wealth distribution is moving away from mature investors, which typically occurs in the late stage of a bull market.
