Record High LTH: Why This Market Trend May Signal Caution Ahead
bitcoin Price Update: June Shows Modest Gains Amid Long-Term Holder Growth
bitcoin‘s Performance in June
In June, bitcoin experienced a slight increase of 2.55%, yet it was unable to break through its previous high of $112,000 set in May. The cryptocurrency remains within a tight trading range, indicating a phase of consolidation, as reported by ARK Invest in their latest bitcoin Monthly analysis.
Rise of Long-Term Holders
A noteworthy trend from the report is the increase in long-term holders (LTHs), who now control 74% of the total bitcoin supply—a level not observed in the past 15 years. This trend reflects a strong commitment from seasoned investors, even as the number of new buyers entering the market continues to decline.
Decline in On-Chain Capital Flows
The report also highlights a decrease in on-chain capital flows during the second quarter, as indicated by the Market-Value-to-Realized-Value (MVRV) momentum metric. This decline suggests a waning enthusiasm in the market and may signal a shift in investor sentiment.
Broader Economic Context
In the larger economic landscape, the U.S. dollar, as tracked by the Fed’s Nominal Broad Trade Weighted Dollar Index, continues to rise, contradicting the prevailing narrative of dollar debasement that has historically supported bullish sentiments in the cryptocurrency market.
Inflation Trends and Their Impact
Inflation rates are showing signs of easing, which raises questions about bitcoin‘s effectiveness as a hedge against inflation. Conversely, lower inflation could lead to reduced federal funding rates, potentially benefiting riskier assets such as technology stocks and cryptocurrencies.
Housing Market Concerns
The report also points out vulnerabilities in the housing market, noting a widening gap between high homeowner expectations and a significant decline in home sales. This disparity may indicate potential strains on consumer confidence and overall economic activity.
