The extended period of heightened activity among Bitcoin's long-term holders has finally normalized, according to the latest Coin Days Destroyed (CDD) 60-Day indicator. After elevated readings since mid 2024, the indicator began normalizing around March 15, 2025, before dropping to significant lows by March 27. The CDD metric, which weights transactions based on coin dormancy, had been signaling unusual behavior from Bitcoin's patient investors for nearly a year. Unlike standard volume, CDD gives greater weight to coins held long-term, making it a crucial sentiment barometer. The initial surge began January through July 2024, followed by a cooling period. Activity resumed with greater intensity from November 2024 through February 26, 2025, reaching levels not seen since 2021's market peak. This suggested long-term holders, who typically view Bitcoin as a store of value, were unusually active. The mid-March normalization represents a significant market shift. The drop to lows on March 27 indicates that these holders have largely completed their repositioning or profit-taking activities. This transition coincides with the market's move into sideways trading, suggesting a correlation between long-term holder activity and broader market directionality.
Historically, extended CDD elevation periods have preceded important market transitions. The return to baseline activity could signal the redistribution phase has concluded, potentially setting the stage for a new market cycle. With fewer long-term holders moving coins, supply dynamics may stabilize, reducing selling pressure. For traders, this suggests monitoring for signs of accumulation, as periods of low CDD following extended high CDD have sometimes preceded new accumulation phases before the next significant market move.
Written by Banker
