Bitcoin Short-Term Holders Maintain Partial Profitability for Nearly a Month

CryptoQuant's analysis of Bitcoin on-chain data shows that short-term holders have maintained partial profitability for nearly a month, marking the longest consecutive in-profit stretch this year. This trend is significant because historically, longer stretches of STH profitability have preceded trend reversals and market recoveries.

According to CryptoQuant, wallets holding coins for less than six months have been profitable since August 16, with $168.2 billion in gains versus $102.6 billion in losses. This split between profit and loss is not as important as the fact that STHs have maintained at least some profitability continuously for about 30 days.

The improved profitability is being driven primarily by entities holding between one and three months, with a realized cost basis of $63,372. In contrast, the more 'mature' end of the STH base, wallets holding for three to six months, shows a higher realized cost basis of $73,190.

CryptoQuant argues that sustained STH profitability is a prerequisite for a more durable reversal in Bitcoin's trend. The firm points out that prior cycles have shown longer stretches of STH profitability preceding market recoveries, and notes that this current streak is unusual compared to earlier episodes.