Bitcoin Shows One of the Clearest Signs of Conviction, Says Alphractal CEO

• The supply in the hands of short-term traders has fallen to its lowest level since 2016.
• "Price captures attention; supply reveals conviction," says Joao Wedson.

Most of the bitcoin (BTC) in circulation is currently held by long-term investors.

This is the main conclusion of the analysis conducted by Joao Wedson, founder and CEO of Alphractal. According to the report published on July 12, 2026, long-term holders concentrate 84% of the circulating supply, while short-term participants control only 16%, their lowest level since 2016.

This is not just a supply statistic. It is a measure of conviction, Wedson stated.

It is important to clarify that, in on-chain analysis, a long-term holder is typically considered someone who keeps their bitcoin for more than 155 days. After this period, the statistical probability of those coins being spent or sold due to short-term fluctuations decreases.

Short-term holders, on the other hand, tend to show greater price sensitivity and react more quickly to episodes of volatility.

The more bitcoin passes into the hands of long-term holders, the less supply tends to be immediately available for sale, Wedson explained.

This does not mean that those bitcoins have been permanently immobilized. Their owners can sell them at any time.

The metric rather shows that they currently remain in the hands of participants whose historical behavior indicates a lower willingness to part with them.

The following chart shows how the distribution of BTC supply has changed over time. The main conclusion is that more and more BTC is passing into the hands of long-term holders, while the amount controlled by short-term investors decreases.

Since 2013, the supply of bitcoin has increasingly concentrated in long-term holders, while short-term holders have reached lows not seen since 2016. Source: Joao Wedson -X.

As seen in the chart, the black line represents the price of bitcoin; the orange line, the supply in the hands of long-term holders; the blue line, that of short-term holders; and the purple line, the relationship between both groups. The rising orange curve stands out, indicating a constant increase in long-term holders.

This is a structure that Wedson interprets as a sign of growing firmness and confidence. Price captures attention. The behavior of supply reveals conviction, he summarized.

These signs of conviction are backed by on-chain data: daily active addresses reached 1.12 million and reserves on exchanges fell to 2.08 million BTC (the lowest since 2018).

However, analysts from Glassnode warn that, although long-term holders show conviction, the risk of a new wave of liquidations remains latent if bitcoin fails to hold the $60,000-62,000 zone in the coming weeks.

The concentration of BTC in the hands of long-term holders reduces selling pressure, but it is not enough on its own to drive the price. For that scarcity to have a bullish effect, demand must also increase.

That is the main point of discussion. While the available supply contracts, bitcoin competes for capital with U.S. equities, companies linked to artificial intelligence, and major initial public offerings (IPOs).

An example is the stock market debut of SpaceX, Elon Musk's aerospace company, which on June 12 staged the largest IPO in history by raising $75 billion, as reported by CriptoNoticias.

Since then, its shares have risen from $150 at debut to trading above $200, capturing a significant portion of investor interest.

Michael Saylor, CEO of Strategy, described this competition directly on June 4: Capital markets are financing the expansion of AI on a historic scale.

Therefore, the structure pointed out by Wedson can act as an amplifier, but it needs new buyers.

If demand increases through spot bitcoin exchange-traded funds (ETFs) or corporate purchases, a smaller amount of BTC available for sale could intensify price movement.

The market has not yet confirmed a new bullish trend.

Other on-chain analyses agree that selling pressure has moderated, although they maintain a more cautious stance on the immediate direction.

Glassnode, an on-chain analysis firm, defines the current scenario as a consolidation regime, considering that selling pressure has decreased and the market is going through a stage of greater equilibrium after recent corrections. Although still without a clearly defined bullish trend.

The firm SwissBlock, for its part, observes early signs of stabilization in various momentum and volume indicators, but warns that it is still a transition, not a confirmed recovery, as it will be necessary for buyers to sustain the advance to validate a new bullish cycle.

Wedson's reading does not resolve that discussion, but adds a relevant element: if demand grows again while part of the supply remains in the hands of long-term holders, the market could react more intensely to the influx of new capital.

All this means that the current market rewards patience but also demands discipline. The key remains risk management and avoiding emotional decisions in a high-uncertainty environment.

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