Bitcoin Long-Term Holders Paused Selling After a 260,000 BTC Distribution Wave

Bitcoin’s long-term-holder selling wave appears to have slowed after a reported net distribution of roughly 260,000 BTC from mid-August through the first half of September 2026. The shift reduces an important source of supply, but it is not, by itself, evidence of a Bitcoin market bottom. Whether it becomes a floor depends on whether demand continues to absorb coins and whether long-term holders return to accumulation. 12

What changed in long-term-holder behavior

In Glassnode’s framework, long-term holders (LTHs) are entities whose coins have been held for roughly 155 days or more. LTH net position change measures the 30-day change in supply held by that cohort: positive readings indicate that coins maturing into the cohort exceed coins being spent, while negative readings indicate net distribution.

That measure reportedly turned sharply negative in mid-August, reaching about 260,000 BTC of cumulative outflow by early September. Contemporary reporting described it as the deepest negative reading since January 2025, following a period of LTH accumulation between March and June. Reports also said the pace of selling had nearly stopped by mid-September. 12

The important distinction is that an on-chain movement is not automatically a market sale. Coins can move for custody, internal restructuring or other non-sale reasons. Still, a sustained negative LTH net-position reading is a useful signal that mature supply is leaving the long-term-holder cohort.

Which holders distributed—and who may have absorbed the coins?

The available evidence does not provide a complete cohort-by-cohort breakdown of the entire 260,000 BTC move. It would be too strong to say that whales, a particular age band, or a single institution was responsible for all of it.

There is, however, a partial picture. Glassnode reported that entities holding 1,000 to 10,000 BTC shed 50,500 BTC from the June 30 low, while entities with more than 100,000 BTC—an address band heavily associated with exchanges, custodians and ETF wrappers—added 59,100 BTC over the same period. Those figures suggest that some supply rotated from large holders into large custodial venues, but they are not a direct accounting of the 260,000 BTC LTH distribution wave.

That difference matters. Address-size categories are not investor identities: a large address may represent an exchange, an ETF custodian, a company, or many underlying customers.

Long-term-holder supply: from accumulation to distribution

Before the August reversal, long-term holders had been accumulating. In July, reporting based on Glassnode data described LTH net position change as positive, at roughly 50,000 to 100,000 BTC on a net basis. 10 Other reports placed LTH supply near record highs in July, around 16.34 million to 16.64 million BTC, although published estimates vary with the provider’s methodology and timing. 6911

By mid-August, VanEck reported that coins held for more than one year had declined by 356,000 BTC over 30 days to 11.84 million BTC, with their share of supply falling below 60%. That measure is not identical to the 155-day LTH definition, so it should not be combined mechanically with the 260,000 BTC figure. It does reinforce the broader conclusion: experienced holders were distributing rather than accumulating during that period. 13

A durable improvement would be visible when LTH net position change stabilizes and eventually turns positive again. A pause in negative readings is encouraging; it is not the same as renewed accumulation.

How to read Coin Days Destroyed without overstating it

Coin Days Destroyed (CDD) measures the age-weighted movement of Bitcoin. For each spent coin, the metric multiplies the BTC amount by the number of days since it was last spent. High CDD therefore means that older, dormant coins have moved; low CDD is more consistent with newer-coin activity.

CDD is valuable context for a distribution analysis, but it does not prove liquidation. An old holder can move coins to a new wallet or a custodian without selling them. The supplied evidence does not provide a comparable current CDD reading against earlier cycle peaks, so no precise claim about whether this episode exceeded historical CDD extremes is warranted.

Demand signals that could offset selling pressure

The clearest supplied demand data came from U.S. spot Bitcoin ETFs. Glassnode reported $2.23 billion of net inflows during a seven-day squeeze window, with no daily outflow in that span—the strongest seven-day intake of the year in its analysis. Bitcoin also reclaimed the short-term-holder cost basis during the move.

That combination is constructive for two reasons:

• ETF creations can introduce substantial spot-market demand.
• Reclaiming the short-term-holder cost basis puts more recent buyers in a stronger position, potentially reducing the incentive for loss-driven selling.

But it does not establish that ETFs absorbed every coin distributed by long-term holders. ETF flow windows, on-chain cohort changes and exchange balances measure different parts of the market and operate on different timeframes.

Glassnode also described coins leaving exchanges alongside broad accumulation during the rally. Lower exchange balances can reduce immediately available trading supply, but exchange outflows may also reflect self-custody transfers or movements among custodians. They should be treated as supporting evidence, not conclusive proof of accumulation.

Why the Federal Reserve decision remains a macro test

At its July 28–29 meeting, the Federal Open Market Committee voted 9–3 to maintain the federal-funds target range at 3.50% to 3.75%. The Federal Reserve’s calendar listed the next meeting for September 15–16.

A rate hold or less-restrictive guidance could support risk appetite and help maintain ETF demand, improving the odds that the slowdown in LTH selling becomes a genuine supply floor. Conversely, a 25-basis-point increase to 3.75%–4.00%, or unexpectedly hawkish communication, could pressure risk-sensitive and leveraged demand just as the market tests whether the distributed supply has truly been absorbed.

That is a market-sensitivity framework, not a forecast. Bitcoin’s response will also depend on inflation, liquidity, ETF flows and investor positioning.

Does the selling pause establish a Bitcoin price floor?

Not yet. The most reasonable reading is that a major distribution impulse has eased. It becomes a stronger floor signal only if several indicators improve together:

1. LTH net position change stops falling and moves back toward positive territory.
2. Old-coin spending and CDD remain contained, indicating that mature supply is not re-entering the market at an accelerating pace.
3. ETF net inflows remain positive beyond a short burst.
4. Bitcoin holds the short-term-holder cost basis on retests, showing that recent buyers are not rapidly turning into forced sellers.
5. Exchange balances continue to decline for credible accumulation reasons, rather than because of custody reshuffling.

Claims that a retest of a particular price level must lead to a 90% crash are speculative. The reported 260,000 BTC distribution and a temporary decline in exchange-held supply do not justify that conclusion on their own. The more useful approach is to watch whether the supply slowdown is followed by renewed long-term accumulation and durable demand.