Bitcoin Holders Show Diamond Hands as Market Profitability Surges 125%

Bitcoin investors have demonstrated a strong resolve to hold onto their assets, even as the market's profitability has surged to unprecedented levels. According to a report, Bitcoin holders have kept their coins off exchanges in recent weeks, despite the market-wide profitability climbing to levels that typically trigger distribution. This behavior is indicative of a strategy known as "diamond hands," where investors hold onto their assets despite market fluctuations.

During the recent Israel-Iran flare-up, Bitcoin's price dropped from $106,000 to $99,000. However, buyers stepped in to defend the short-term holder cost basis at $98,300, pushing the market back to $107,000 after a cease-fire was announced. This bounce was seen as a "constructive signal" because it occurred at a level that historically separates bullish from bearish regimes. The episode left the market cap at nearly $2.13 trillion and the realized cap at $958 billion, resulting in approximately $1.2 trillion in unrealized profit across the network.

The Market Value to Realized Value (MVRV) ratio indicates that the average coin now boasts a 125% paper gain, which is well above neutral but below the March reading of 180%. Despite the incentive, realized profit averaged just $872 million per day, far below the $2.8 billion and $3.2 billion spikes recorded when Bitcoin first reached $73,000 in March 2024 and $107,000 in December 2024. This suggests that both long- and short-term holders have dialed back spending after a brief uptick near the latest all-time high, sending the sell-side risk ratio toward low-activity territory.

Coins dormant for at least 155 days rose to an all-time high of 14.7 million BTC, confirming that maturation flows outweighed distribution. The "liveliness" gauge, which compares coin-day creation to destruction, continued to decline. This pattern reinforces the view that holding remains the dominant strategy. Furthermore, wallets that bought during January’s breakout above $100,000 still retain most of those coins, underscoring resilient sentiment under the surface.

The stablecoin supply ratio oscillates near its baseline, indicating that the buying power in dollar-pegged tokens roughly aligns with the available Bitcoin supply. Exchange buying-power data show a rotation of stablecoin capital into significant assets over the past month, and net inflows to US spot Bitcoin ETFs climbed to a seven-day average of $298 million. These flows indicate “growing institutional engagement at scale,” complementing the reluctance of existing holders to part with their coins.

According to the report, a fresh price expansion may be required to entice meaningful selling, as current levels fail to generate sufficient profit-taking to absorb new demand. This analysis suggests that Bitcoin holders are exhibiting a strong resolve to hold onto their assets, even as the market's profitability surges to unprecedented levels. The behavior of Bitcoin holders, characterized by their "diamond hands," is a testament to their confidence in the long-term potential of the cryptocurrency. The market's resilience, as evidenced by the defensive buying during the Israel-Iran flare-up, further underscores the bullish sentiment among investors. The report's findings highlight the growing institutional engagement in the Bitcoin market, as well as the reluctance of existing holders to part with their coins. This combination of factors suggests that the market is poised for further growth, as long as the current trends continue.