Bitcoin's Reset May Be Over as On-Chain Data Suggests a Cycle Low

According to the RHODL ratio, a key on-chain metric developed by Glassnode, the balance between long-term and short-term Bitcoin holders is signaling a market bottom rather than a cycle top, having reached a ratio of 4.5. Currently, the indicator is at its third-highest level on record, showing that wealth is becoming increasingly concentrated in older coins as younger, more speculative holdings have been largely eliminated during the 50% correction in Bitcoin over the past six months. The ratio compares the value of coins held by longer-term investors, typically those holding for six months to three years, against coins held by short-term participants, defined as one day to three months, providing insight into whether the market is dominated by seasoned holders or fresh demand from new entrants. A rising ratio often reflects coins aging and a decline in speculative activity, rather than an influx of new buyers, a dynamic that typically emerges after sharp corrections, as seen in 2015, 2019, and 2022. There have been two occasions where the RHODL ratio has been higher than the current level, in 2015 and 2022, both of which were cycle lows, suggesting there could be further downside for Bitcoin. However, reaching even higher levels typically requires a deeper collapse in short-term holder activity and near-complete demand exhaustion, conditions that are less evident today given the 25% price recovery from the February lows, negative perpetual funding rates, and the broader macro risk environment, which has seen the S&P 500 hit new all-time highs.