Cryptocurrency analyst Willy Wu has clarified his recent claims that Bitcoin is on the verge of an early sell-off.
Data shared on social media suggests that since October 15, long-term Bitcoin holders (LTH) have sold around 28,000 BTC, more than new investors bought.
Wu noted that the data underlying these claims can be misinterpreted. According to the analyst, the definition of “long-term investor” includes coins that have been inactive for more than five months. Therefore, he argued that the increase in LTH supply actually indicates that purchases made five months ago have moved to long-term status.
Mr. Wu explained:
The increase in supply of long-term investors (LTH) is not real-time data. It will be reflected after 5 months delay. Conversely, a decrease in the supply of LTH indicates that the old supply is quickly sold off.
The analyst said a slight decline in LTH supply should generally be considered “localized profit-taking” and does not necessarily mean a large-scale sale that would cause panic in the market.
“There are only a few small profit-taking movements on the chart. The rest of the data appears to be bearish in nature, but it actually creates a misleading picture,” he said.
*This is not investment advice.
