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Before yesterday’s plunge, Bitcoin’s recent rally managed to propel the asset to a new all-time high of $108,000, marking another milestone in its upward trajectory.
However, according to the latest analysis, this notable price rise comes with signs of potential market volatility, as long-term holders begin to demonstrate selling activity.
Attention has focused on the Binary Coin Days Destroyed (CDD) metric, an essential tool for assessing the behavior of Bitcoin holders over the long term.
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What are long-term holders currently reporting?
The Binary CDD metric tracks long-term holder activity by measuring the number of “coin days” destroyed relative to the total supply. When this metric peaks, it often indicates increased selling pressure from long-term investors.
According to CryptoQuant analyst ShayanBTC, the Binary CDD metric recently saw a sharp increase, coinciding with Bitcoin’s new all-time high price.
Historically, such spikes in this measure have been precursors to market corrections, suggesting that these holders are taking advantage of current price levels to reduce their exposure.
Shayan added that long-term actions of holders often serve as a barometer for broader market sentiment. The recent increase in the Binary CDD metric suggests that these holders may view the high above $108,000 as a strategic exit point.
If this selling pressure intensifies, it could lead to increased market volatility and potentially trigger a price correction.
Bitcoin Market Outlook
Bitcoin has seen a roller coaster ride over the past day. Notably, following yesterday’s FOMC news results as well as the speech by Jerome Powell, Chairman of the United States Federal Reserve, Bitcoin saw its price drop significantly to as low as $98,000.
However, the latest price action has been quite interesting as BTC is showing a rebound. In the early hours of Thursday, Bitcoin saw a recovery in its price after reclaiming $100,000 to trade above $105,000.
Currently, Bitcoin has seen a return to a price of $100,718, at the time of writing, marking a 3.5% decline over the past day and a reduction of around 6.6% from its highest all-time high (ATH).
Meanwhile, complementing Shayan’s story, another CryptoQuant analyst, Onatt, highlighted additional market indicators that suggest potential turbulence.
The Coinbase Premium Index, which tracks the price difference between Coinbase and other exchanges, is currently in negative territory, indicating increased selling pressure.
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Additionally, the adjusted ratio of profit to output spent (aSOPR), a metric used to assess profit-taking behavior, showed sudden spikes.
According to Onatt, these signals collectively highlight the need for sustained institutional demand, particularly through Bitcoin exchange-traded funds (ETFs), to stabilize market conditions.
Featured image created with DALL-E, chart from TradingView
