Bitcoin reached an all-time high (ATH) of $89,604 early on Tuesday, pushing its market value to $1.77 trillion, driven by positive momentum following the U.S. election results. Trading at $88,400 at the time of reporting, the leading cryptocurrency saw a spike in daily trading volume, currently sitting at $133 billion.

BTC price, dormant circulation and MVRV ratio | Source: Santiment

Long-Term Holders Begin to Sell

Data from Santiment reveals that dormant Bitcoin holders are re-entering the market, with a 130% increase in two-year dormant BTC circulation over the past day, amounting to 13,589 BTC. Meanwhile, BTC held for over three years saw a 154% rise, with 8,235 BTC moved in 24 hours. Such sell-offs have historically prompted price corrections, as seen in August when long-term holder activity led to a price drop from $60,000 to $54,000 within a week.

The recent ATH has boosted Bitcoin’s Market Value to Realised Value (MVRV) ratio to 178%, indicating that the average BTC holder now enjoys a 178% profit. Historically, elevated MVRV ratios often lead to increased profit-taking, which can result in price pullbacks as investors cash in on gains.

Crypto Market Cap Hits Record High

Bitcoin’s rally has lifted the entire cryptocurrency market, which now sits at a record global market cap of $3.11 trillion, a 4.7% increase in the last 24 hours. Over the past week, the market cap surged by $765 billion, fueled by increased institutional interest, with crypto investment products seeing record inflows of $31.3 billion year-to-date.

Institutional Demand Rises Post-Election

Following Donald Trump’s re-election, crypto-related assets have experienced renewed interest from institutional investors, with assets under management rising to $116 billion. This marks a significant rise in institutional confidence as the market embraces a ‘green’ rally driven by Bitcoin’s gains.