Bitcoin Ownership Shift and Market Maturity: An Analytical Overview

Article Summary

• Slowing Bitcoin supply turnover as long-term holders distribute coins.
• Bitcoin spot ETFs and corporate treasuries absorbing a significant portion of short-term supply.
• Stable volatility indicates market maturity and institutional dominance.
• Analysis of Bitcoin holder behavior and its impact on market sentiment.
• Understanding how changes in active supply and demand channels affect recent market fluctuations.

Bitcoin's Blockchain Analysis: Ownership Shift and Market Maturity

After reaching an all-time high earlier this year, Bitcoin has entered a phase of consolidation, punctuated by minor drawdowns. Macroeconomic headwinds, a weaker stock market, and significant crypto liquidation events have dampened market sentiment, raising questions about the sustainability of the Bitcoin bull market. Additionally, growing concerns about large holders transferring or selling early holdings have placed pressure on Bitcoin and the broader cryptocurrency market. Currently, the total market capitalization of cryptocurrencies is around $3.6 trillion. However, beneath the surface, Bitcoin's on-chain data offers critical context.

In this article, we will explore how changes in Bitcoin holder behavior and core demand drivers impact market sentiment and define the pace of this cycle. By analyzing changes in active supply and demand channels, we will examine whether recent market volatility is a signal of end-of-cycle profit-taking or a structural shift in Bitcoin ownership.

Supply Distribution and Institutional Absorption of Active Supply

First, let’s look at Bitcoin’s active supply, which is defined as the amount of time since a coin was last moved on the blockchain. This metric reveals the distribution of supply between “dormant coins” and “recently moved coins.” The chart below illustrates the proportion of Bitcoin supply that has not moved for more than one year, which can be used as a proxy for the holdings of Long-Term Holders (LTH). Historically, this proportion increases during bear markets (as coins concentrate in the hands of LTHs) and decreases during bull markets (as LTHs begin to move coins and realize profits). As of now, approximately 52% of the 19.94 million circulating Bitcoins have not moved for more than one year, down from 61% at the start of 2024. Both the increase during bear markets and the decrease during bull markets show a trend towards flattening, with intermittent distribution phases occurring in Q1 2024, Q3 2024, and recently in 2025. This suggests that LTHs are selling their coins in a more sustained manner, reflecting an elongation of the ownership transfer cycle.

Bitcoin Spot ETFs and Corporate Treasuries: Core Demand Drivers

Conversely, short-term supply (coins that have been active within the last year) has been steadily increasing since 2024, due to previously dormant coins re-entering circulation. Simultaneously, spot Bitcoin ETFs have launched and Corporate Treasuries (DAT) acquisition has been accelerating. These two channels have brought new, sustained demand, absorbing the supply released by LTHs. As of November 2025, the number of Bitcoins active within the last year is 7.83 million, an approximately 34% increase from 5.86 million at the start of 2024 (re-circulation of dormant coins). Over the same period, the holdings of spot Bitcoin ETFs and Strategy have increased from approximately 600,000 Bitcoins to 1.9 million, absorbing approximately 57% of the net increase in short-term supply. Currently, these two channels combined account for approximately 23% of short-term supply. Despite slowing inflows in recent weeks, the overall trend indicates that supply is gradually shifting to more stable, long-term holding channels, a unique feature of the market structure in this cycle.

Short-Term vs. Long-Term Realized Profit Trends

Further substantiating the smooth features of Bitcoin's supply dynamics are realized profit trends. Spent Output Profit Ratio (SOPR) is used to assess whether coin holders are selling coins at a profit or loss, providing clear insights into the distinct behavior patterns of the coin holder group in market cycles. In previous cycles, profit and loss realization by long-term and short-term holders often showed sharp and synchronous fluctuations. Recently, this relationship has diverged: the SOPR for LTHs remains slightly above 1, indicating that they are steadily realizing profits and selling moderately on highs. On the other hand, the SOPR for short-term holders is hovering around the breakeven point, which also explains the cautious recent market sentiment as many short-term holders' holdings are approaching the cost price. This divergence in behavior between the two coin holder classes reflects a market in a smoother phase: institutional demand is absorbing the supply released by LTHs, rather than repeating the large fluctuations of the past. If the SOPR for short-term holders continues to exceed 1, it may represent increasing momentum in the market. Although comprehensive drawdowns will still squeeze the ability of all coin holder groups to realize profits, the overall pattern shows a more balanced market structure: supply turnover and profit realization are gradually advancing, elongating the pace of the Bitcoin cycle.

Decreasing Bitcoin Volatility

This structural flattening is also reflected in Bitcoin's volatility, which has been in a long-term downward trend. Currently, Bitcoin’s 30-day, 60-day, 180-day, and 360-day realized volatility is stabilizing at around 45-50%, while its volatility in the past was extremely explosive, causing significant ups and downs in the market. Today, Bitcoin's volatility characteristics are increasingly similar to large tech stocks, indicating its maturation as an asset. This reflects both improved liquidity and reflects a more institutionally-led investor base. For asset allocators, lower volatility may increase the attractiveness of Bitcoin in investment portfolios, especially as its correlation with stocks, gold, and other macroeconomic assets remains dynamically variable.

Conclusion

Bitcoin’s on-chain trends suggest that this cycle is progressing in a smoother, longer phase, without the frenzied rallies seen in previous bull markets. Long-term holders are gradually distributing coins, and most of them are being absorbed by more sustainable demand channels (ETFs, corporate treasuries, and broader institutional holding). This shift marks a maturation of market structure: lower volatility and trading speed, and cycle lengthening. However, market momentum still depends on the sustainability of demand. The flattening of ETF inflows, pressure on some corporate treasuries, recent liquidation events in the entire market, and the SOPR for short-term holders being near the breakeven point all highlight that the market is going through a readjustment phase. The continued rise in the supply of long-term holders (coins that have not been moved for more than one year), SOPR exceeding 1, new inflows into spot Bitcoin ETFs, and stablecoin fund flows may be key signals for the return of market momentum. Looking ahead, the mitigation of macroeconomic uncertainty, the improvement of liquidity conditions, and regulatory progress related to market structure may re-accelerate inflows and extend the bull market cycle. Despite waning market sentiment, after the recent leverage adjustment, the market foundation is healthier with the support of expanding institutional channels and the popularization of blockchain infrastructure.