According to recent research, Bitcoin is in a “transition,” which could pave the way for the next bull market peak.
In the most recent issue of its weekly newsletter, “The Week On-Chain,” analytics firm Glassnode announced its newest tool for following Bitcoin’s revival.
Following the 2022 bear market and signs of recovery in Q1 this year, on-chain measures have experienced a significant metamorphosis, with many indicating that a long-term BTC price bottom has already been reached.
However, with price action stagnant since mid-March, worries have returned, along with downside estimates stretching over $20,000.
According to Glassnode experts, Bitcoin’s long-term investor base is already planning for better times ahead.
Analysts announced a new method of gauging sentiment among these long-term holders (LTHs) — individuals who have held BTC for at least 155 days — using existing on-chain technologies.
The tool, titled “Long Term Holder Spending & Profitability,” divides LTH behavior patterns into four stages.
LTHs have began a “transition” toward a state of “equilibrium” after a period of “capitulation” at the end of 2022, before complete “euphoria” — the next BTC price cycle peak — arrives.
Glassnode defines capitulation as a situation in which the “spot price is lower than the LTH cost basis,” with large LTH spending “likely due to financial pressure and capitulation.”
Meanwhile, transition occurs when the “market is trading slightly above long-term holders’ cost basis, and occasional light spending is part of day-to-day trade.”
Separate figures reveal that the LTH cost basis was roughly $20,800 as of May 30.