Bitcoin Short-Term Holder Cost Basis Drops Below Long-Term Holder, Triggering Bear Market End Signal

Odaily Planet Daily News Analysis shared by blockchain analytics platform CryptoQuant on July 18 shows that Bitcoin's short-term holder cost basis has fallen below the adjusted long-term holder cost basis, triggering a "bear market end" signal. This signal uses a 3-day confirmation window to compare the average purchase prices of short-term and long-term holders. 

The analysis indicates that short-term holders are investors who have held Bitcoin for less than 6 months, while long-term holders are those who have held it for more than 6 months. The short-term holder cost basis has dropped from $112,500 to $69,000, reflecting that Bitcoin purchased within the past 6 months is changing hands at lower prices. The analysis states that the adjusted long-term holder cost basis excludes Bitcoin held for over 7 years to reduce the impact of dormant supply. This current crossover is described as a change in position structure, pointing to the later stages of a bear market, but it does not equate to confirming a market bottom or the start of a new bull run. 

The analysis also added that if the short-term holder cost basis rises back above the adjusted long-term holder cost basis, it would align with bull market confirmation signals seen in previous cycles. Until then, this signal only indicates that the Bitcoin bear market may be nearing its end.