Ethereum (ETH) is closing 2024 with a strong edge over Bitcoin (BTC) in terms of long-term holder growth, reflecting rising confidence in the asset as 2025 approaches.
Data from IntoTheBlock revealed that the proportion of Ethereum holders who kept their tokens for over a year increased from 59% in January to 75.1% by the end of December.
This chart shows the percentage of long-term Bitcoin and Ether holders over the past year.
While the share of long-term Bitcoin decreased, the percentage of long-term ETH holders climbed, surpassing that of Bitcoin early in the year.
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In contrast, Bitcoin’s long-term holders saw a steady decline, falling from 70% to 62.3% over the same period.
This divergence in long-term holding patterns highlights a broader shift in market sentiment, with Ethereum appearing to attract more confidence amid growing adoption and regulatory clarity.
Ethereum long-term holders soar
Throughout 2024, Ethereum consistently gained ground as a preferred asset for long-term investors. IntoTheBlock categorizes long-term holders as those retaining their tokens for more than a year.
By the end of December, three-quarters of Ethereum holders fell into this category, compared to 59% at the beginning of the year.
This upward trend has been driven by factors such as the addition of staking options in Ether ETFs and increased regulatory clarity from the Commodity Futures Trading Commission (CFTC).
Bitcoin, on the other hand, experienced a noticeable decrease in its long-term holder base. Starting the year with approximately 70% of holders in the long-term bracket, the figure dropped to 62.3% by December.
Analysts have linked this decline to profit-taking during BTC’s record-breaking rally in mid-December, which saw the asset hit an all-time high of $106,000 before settling at $93,711 by month’s end.
Spot Ether ETFs see $2.1B inflows in December
Ethereum’s rise in long-term holdings was complemented by a significant uptick in spot Ether exchange-traded fund (ETF) inflows.
December saw cumulative net inflows into these ETFs reach $2.1 billion, doubling the $1 billion recorded in November.
This robust demand reflects a growing institutional interest in Ethereum as an asset with long-term potential, bolstered by its transition to a proof-of-stake model and growing utility in decentralized finance (DeFi) applications.
Meanwhile, Bitcoin’s price fluctuations, attributed to large-scale sell-offs by long-term holders, have not dampened optimism entirely.
Technical analyst Ger Van Lagen projected Bitcoin could surpass $200,000 shortly, despite its recent volatility.
The contrasting trends in long-term holding patterns suggest Ethereum may be viewed as a safer and more sustainable investment going forward.
Why this optimism for Ethereum
The optimism surrounding Ethereum heading into 2025 is also underpinned by broader market developments.
Experts anticipate a Trump administration could favor cryptocurrencies like Ethereum through regulatory reforms, including overhauls of the Securities and Exchange Commission (SEC).
This environment, coupled with the growing adoption of staking in Ether ETFs, positions Ethereum as a leader in the crypto space.
By contrast, Bitcoin faces challenges in retaining long-term investor confidence, as seen in its declining holder percentage.
While its role as a digital store of value remains unchallenged, the dynamics between Bitcoin and Ethereum illustrate a shifting landscape in crypto investment preferences.
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