Approximately 200,000 BTC have moved out of long-term holder wallets over the past week, suggesting that the activity may be linked to changes in custody strategies rather than widespread selling.
The effects of the Coldcard security breach are now becoming visible through on-chain data.
According to Glassnode, around 210,000 BTC have left long-term holder (LTH) wallets in the last seven days, representing the largest decline in long-term holder supply since December 2024, when Bitcoin was approaching the $100,000 milestone.
Glassnode identifies long-term holders as investors or entities that have held their coins for at least 155 days. This group is often considered “smart money” because these participants typically remain committed through short-term market volatility and tend to sell only during major market cycles.
Long-term holder supply has now fallen to about 14.7 million BTC, down from just below 15 million BTC before the Coldcard incident, when holdings were close to record levels.
Historically, major reductions in long-term holder supply have often occurred during bullish market phases or near price peaks. Similar distribution patterns appeared around Bitcoin’s highs in March 2021, March 2024, and December 2024, when veteran holders sold portions of their holdings into periods of strong demand.
This latest movement stands out because it is happening while Bitcoin remains far below its previous peak. The asset is currently trading near $64,000, roughly half of its October all-time high.
Unlike previous cycles, the current decline in long-term holder supply does not appear to be driven primarily by profit-taking. Instead, it may reflect investors moving their Bitcoin into different storage solutions following the Coldcard security incident. Bitcoin also managed to avoid setting fresh lows after the exploit.
The Coldcard breach was caused by weak randomness in certain firmware versions, which allowed attackers to potentially recreate wallet recovery phrases and access affected funds. Thousands of addresses were impacted, with estimated losses reaching as high as $114 million. Coldcard advised affected users to create new wallets and transfer their assets, noting that a firmware update alone cannot protect wallets if private keys have already been exposed.
Some of the recent decline in long-term holder supply may therefore represent users transferring BTC into newly generated wallets with improved security. Other investors may be choosing regulated custodians or spot Bitcoin ETFs as they reconsider the risks associated with managing private keys themselves.
ETF demand has remained strong during this period. U.S. spot Bitcoin ETFs attracted around $754 million in inflows over the past week, with BlackRock’s iShares Bitcoin Trust (IBIT) accounting for a significant share of the investment.
The important distinction is that Bitcoin moving between wallets does not automatically indicate selling. In this case, the reduction in long-term holder supply may reflect a broader shift in Bitcoin custody practices rather than weakening confidence among long-term investors.
