The last eighteen months have been difficult for Bitcoin investors. Despite a strong bounce back in 2023, the asset is still over 60% off its all-time high set in November 2021. This is due to the Federal Reserve’s transition to a tight monetary policy approach in response to spiralling inflation.

However, an interesting bright spot from looking at the on-chain data has been the growth of long-term holders. According to a chart from Glassnode, the cohort has grown steadily over the last eighteen months, with the exception of three brief periods. As of now, long-term holders control 75% of the total circulating supply of Bitcoin.

Enthusiasts believe that the increase in the amount of coins hoarded by long-term holders will cause a supply shortage and push the price of Bitcoin up in the long-term. This is because there is a capped supply of 21 million coins and the rate of increase is halving every four years.

The three periods in which long-term holders showed a waver were from May to August 2022, when the crypto world was thrown into disarray; then very briefly after the FTX collapse last November; and the third in March of this year, when Bitcoin prices increased after dovish forecasts around future interest rate rises following the regional bank crisis.

Thus, the apparent resilience of long-term holders throughout these turbulent times is certainly a silver lining. Whether or not this will have any effect on the long-term price of Bitcoin, only time will tell.