Bitcoin’s “Strong Hands” Point to a Possible Bottom, but Buyers Remain Scarce
Bitcoin is shifting into the hands of longer-term holders. New demand, meanwhile, remains weak. We saw the same broad pattern around the 2022-2023 bear market bottom, and I’ll be honest: that is encouraging. But it does not prove BTC has found a floor. Fresh money still matters. Without it, any rally will struggle to last.
On-chain analyst Axel Adler Jr. says Bitcoin has been moving away from short-term traders and toward people prepared to ride out the correction. The numbers are stark. Short-term holders (STH) now account for 23.5% of Bitcoin’s realized capitalization, down from 27% a month ago and 40% three months ago. The share has not been this low since December 2022 and January 2023. It is also below roughly 96% of Bitcoin’s historical readings.
Coins held for three to six months account for most of the change, with their share falling from 23% to 9% in three months. Were all those coins dumped? No. Many simply aged into the next bracket. Recently purchased Bitcoin is changing hands less often, in other words. My take: Adler’s reading of less speculation and less new capital makes sense, though selling has not stopped.
Long-term holders (LTH) now account for 52.5% of realized capitalization. That is barely above the roughly 52% recorded a month ago, yet far above the 42% reading from three months earlier. Bitcoin has exceeded the current level only once, when the share reached 55% during the 2018 cycle. Most of the increase came from the six-to-12-month group. Its share rose from 27% to 35% as owners left their coins alone.
This is where the data gets seductive. Most bottoming narratives treat a rising LTH share as straightforward evidence of accumulation. That is only half right. The figures do not show long-term holders buying heavily; they show them holding through the correction. Fewer coins may be available for sale, but limited supply cannot raise the price by itself. Buyers must still turn up. If they do, a thin market could move fast. The setup looks interesting. It is not confirmation.
Bitcoin is moving out of speculators’ hands: the STH share has fallen to 23%, its lowest level since the 2022-2023 bottoming period, while the LTH share has approached historical highs.
Coins are being moved less frequently, but demand has yet to recover. I break down what… pic.twitter.com/WKd5PK65Vd
Axel Adler Jr. (@AxelAdlerJr), July 31, 2026
Darkfost, another on-chain analyst, says short-term holders are still capitulating. Their realized capitalization has fallen nearly 62% since its October 2025 peak. Past Bitcoin bear markets brought declines of around 70% to 75%, placing the current drop near that range. Near does not mean over. I would not wave away the remaining gap: anyone who has traded through a bear market knows the final stretch can be brutal.
Two kinds of activity drive the decline. Some holders sell at a loss after buying at higher prices; others buy coins more cheaply. In either case, the realized capitalization assigned to short-term holders falls. Heavy losses have often appeared near market reversals because anxious traders eventually exhaust the coins they are willing to sell. Does that give investors a countdown to the bottom? No. History offers a comparison, not a timetable.
STH continue to realize losses, which, cumulatively, are starting to become very significant.
STH realized capitalization has fallen nearly 62% since its peak in October 2025.
This decrease in STH realized cap stems from several typical behaviors that can… pic.twitter.com/mi5XyGrNs5
Darkfost (@Darkfost_Coc), July 29, 2026
The market looks tight. Strangely quiet, too. Long-term holders are staying put, while short-term holders are taking losses. Buyers still have not returned in force. Counter to the usual bullish reading, low liquidity is not automatically good news. Capital coming back could trigger a sharp move. This situation could also persist for months.
Investors in traditional risk assets have moved toward what they consider safer holdings, although their reasons differ. Bitcoin could attract money if economic uncertainty or geopolitical tension increases, particularly from investors who view its fixed supply as protection against conventional markets. Is Bitcoin truly a safe haven? I remain unconvinced. It has never been famous for staying calm. For now, BTC appears to be consolidating while the market waits for a reason to buy. Demand may return, but nobody knows when—or how much.
What this means
The on-chain data suggests holders’ conviction is being tested. More Bitcoin now sits with long-term owners, leaving less supply available for immediate trading. A strong return in demand could send prices higher quickly. Yes, that sounds bullish. The uncomfortable correction is that thin liquidity cuts both ways and can make declines uglier when sellers take control. Traders should prepare for wider moves rather than assume prices will rise next.
A real shift requires more than another month of coins growing older. In my view, the short-term holder share needs to increase alongside Bitcoin’s price. Trading volume and capital inflows must strengthen as well. Those figures would provide clearer evidence that new buyers are entering the market and absorbing the available supply.
Resistance breaks deserve attention only when volume supports them. Decisions by large financial institutions or regulators could bring buyers into the market, especially if they make Bitcoin easier to access or resolve a particular legal uncertainty. Loose promises about adoption? Probably not enough. They are unlikely to move much money.
The next few months may reveal whether this period truly resembles the 2022-2023 bottom or merely looks similar on a few charts. I would keep that distinction front and center. Long-term holders are staying put. Bitcoin still needs buyers.