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In a recent tweet, on-chain analytics platform IntoTheBlock posted subscriber A chart highlighting long-term shareholder ratios Ethereum and Bitcoin. Alongside its tweet, IntoTheBlock posted a graph displaying the “hold percentages” of these two major cryptocurrencies.
Currently, 74.7% of Ethereum addresses are held long-term, which is significantly more than Bitcoin, IntoTheBlock reported. This represents a major development in the cryptocurrency space, as Bitcoin has traditionally been viewed as the primary asset for long-term investment.
The recent trend reflects a significant shift in Ethereum's investor base, showing an increasing trend toward long-term holding rather than short-term speculation.
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This trend can be attributed to a variety of factors, including staking, which encourages stockholders to lock up their assets for long periods, thus reducing selling pressure. The Shanghai/Capella update, also known as Shapella, allowed the withdrawal of Ethereum stakes on April 12, 2023. This upgrade marks a major milestone for the Ethereum network, completing the transition from Proof of Work to Proof of Stake.
Furthermore, the Ethereum ecosystem has grown significantly, with increased demand for the platform through decentralized finance (DeFi), non-fungible tokens (NFTs), and smart contracts.
Ethereum price movement remains the main determinant
While the long-term retention trend is strong, the report by IntoTheBlock suggests that this behavior could change if... Ethereums price is approaching its previous all-time highs. Historically, cryptocurrency investors tend to take profits when prices reach important milestones.
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“This trend is likely to continue until Ethereum approaches its all-time high and holders start taking profits,” IntoTheBlock stated. However, the current long-term holding trend suggests that most investors may be committed to Ethereum's future growth.
At the time of writing, Ethereum's price has fallen by 1.35% over the past 24 hours to $3,301, amid an ongoing sell-off in the cryptocurrency market. Ethereum is on track for a fourth day of losses if it ends negative today, following highs of $3,746 on January 6.
The decline led to a loss of support at the daily 50 simple moving average at $3,580 and the low of $3,206 in Wednesday's trading session, near where ETH is currently trading.
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