Bitcoin LTH Selling Continues as Demand Absorbs Supply

| panewslab.com
Bitcoin long-term holders (LTHs) have reduced their holdings for seven consecutive weeks as BTC rises, signalling gradual profit-taking rather than an immediate supply shock. LTH holdings fell by about 73,400 BTC by 28 September, compared with 1,100 BTC the previous week, after the supply-change indicator turned negative on 17 August. This followed accumulation from February to early August, including an estimated 1.2 million BTC increase in May. Current Bitcoin LTH selling remains below the roughly 1.07 million BTC reduction recorded in November 2025. LTH SOPR stayed above 1 for two weeks, reaching 1.24 on 21 September before easing to 1.18 on 28 September, indicating average realised profits of about 18%. New demand has so far absorbed the additional Bitcoin market supply and supported the price. Traders should monitor LTH outflows, spot demand and BTC momentum. A further distribution wave of several hundred thousand BTC, combined with a stalled Bitcoin price, could signal weaker demand and increased downside risk.
Neutral
The immediate price impact on Bitcoin is neutral because long-term holder selling is being absorbed by new demand, allowing BTC to continue rising. The seven-week decline in LTH holdings and LTH SOPR above 1 show persistent profit-taking, but the distribution remains smaller than the major reduction recorded in November 2025. In the short term, continued spot demand could keep Bitcoin supported despite additional market supply. However, traders may become more defensive if LTH outflows accelerate, SOPR remains elevated and BTC fails to make further gains. A new distribution wave of several hundred thousand BTC alongside stagnant prices would suggest that market absorption is weakening and could trigger increased volatility or a downside move. Over the longer term, the market remains constructive if new buyers continue to absorb coins released by long-term holders. Conversely, sustained LTH selling without matching demand could turn the supply pressure bearish. Historical profit-taking periods can be absorbed during strong uptrends, but they often become more damaging when momentum fades and liquidity thins.