Bitcoin RHODL Ratio Rises to Third-Highest Level in History, Possibly Indicating Bitcoin Bottom Has Formed

Odaily News According to Glassnode's Bitcoin on-chain indicator, the RHODL Ratio currently stands at 4.5, reaching the third-highest level on record. The signal it emits aligns more with a market bottom than a cycle top.

The RHODL Ratio compares the value proportion of Bitcoin held by long-term holders (holding for 6 months to 3 years) with that held by short-term holders (holding for 1 day to 3 months). A rising ratio typically reflects longer holding periods and reduced speculative activity, rather than an influx of new buyers—a dynamic observed after major corrections in 2015, 2019, and 2022. During the past six months, as Bitcoin fell by 50%, a significant amount of speculative holdings has been washed out, concentrating wealth among long-term holders.

Historically, the RHODL Ratio has only been higher than the current level twice: in 2015 (ratio of 5) and 2022 (ratio of 7), both corresponding to cycle bottoms. This suggests that Bitcoin may still have further downside potential. However, pushing the ratio to even higher levels typically requires near-complete exhaustion of short-term holder activity, a scenario not yet evident under current conditions—Bitcoin has rebounded approximately 25% from its February low, perpetual futures funding rates remain negative, and the S&P 500 has also reached a record high.

Overall, this indicator suggests that the current market conditions are more akin to a correction within a cycle rather than a pattern at the cycle top. The renewed dominance of long-term holders may signal that a phase bottom is approaching. (CoinDesk)