Analysis: The share of Bitcoin short-term holders continues to decline, and the market may be close to the end of the bear market

Comparing news, CryptoQuant analyst Darkfost wrote that the number of short-term holders (STH) in the Bitcoin market is declining, which is a positive sign. Currently, the share of BTC supply held by STH has declined markedly, with 1.2% held for less than 1 day, 2% for 1 day to 1 week, 5.6% for 1 week to 1 month, 6.7% for 1 to 3 months, and 8.1% for 3 to 6 months.

Darkfost points out that this trend will occur at the end of every bear market. On the one hand, this means that the share of long-term holders (LTH) is increasing. BTC held by LTH is less likely to be transferred than STH, which is active and more sensitive to market fluctuations.

On the other hand, the decline in STH's share also indicates that market demand has yet to return. Every BTC purchase creates a new STH UTXO, and when market demand is strong, STH's share of supply will rise rapidly and may eventually reach a high position near the top of the market.

Darkfost believes that the market is currently approaching a negative extreme state, where market attention and demand are still low, and the number of STH continues to decline, which is generally a positive sign.