Bitcoin Is Slowly Exiting the Hands of Long-Term Investors: What's Happening?

The “Bleed” Phenomenon - The Slow Dripping of Market Blood

Bleed is what? It perfectly describes the current state Bitcoin is experiencing. Instead of a sudden sell-off explosion, the selling pressure now resembles a continuous, controlled flow, gradually. Despite strong support from ETFs, companies, and institutions, BTC price still faces pressure from the most patient group in the market: long-term Bitcoin holders (LTHs).

Chris Kuiper, Vice President of Research at Fidelity Digital Assets, explains this phenomenon through specific data. According to figures, the percentage of Bitcoin inactive for at least one year is slowly decreasing — a sign that long-term holders are gradually retreating from the market.

Why Are Long-Term Investors Selling Now?

There are several reasons for this behavior. First is disappointment. Recently, Bitcoin has underperformed gold and the S&P 500. Many expected a strong seasonal rally in October and November but were ultimately disappointed.

Second are considerations of year-end taxes and portfolio adjustments. As the year ends, investors are motivated to take profits for financial calculation reasons.

Third is fatigue psychology. The market has been sideways around $100,000 for a long time, causing holders to feel impatient.

Confirmed Data: The Current Cycle Differs from Previous Ones

CryptoQuant analyst Julio Moreno compared Bitcoin withdrawal levels across cycles:

• 2017-2018: 20% decrease
• 2021: 10% decrease
• 2024-2025: 10% decrease

The main difference is the speed. Instead of chaotic sell-offs, this cycle manifests as a steady, controlled flow. That is “bleed” — slow blood loss rather than heavy bleeding.

Positive Aspect: Portfolio Diversification

Although prices are weak, Kuiper emphasizes an important bright spot: Bitcoin’s correlation with gold continues to decrease. This is actually very important for institutional investors.

An asset is only valuable if it moves differently from what’s already in the portfolio. If Bitcoin only moves like gold, organizations can simply copy by increasing leverage elsewhere. But when Bitcoin operates more independently, it provides true diversification — which is why institutional investors are motivated to allocate long-term capital.

The Current Picture

With Bitcoin’s current price at $95.56K, down 1.74% in the past 24 hours, the market continues to reflect a balance between selling pressure from LTHs and support from new investors. This slow bleed, while demonstrating market patience, also signals that the current cycle is following a certain historical pattern — just at a different speed.