Long-term crypto investors grow more optimistic, meanwhile short-term traders cash in their gains
In the world of cryptocurrencies, Ethereum (ETH) continues to make headlines as it navigates through market fluctuations. Here's a round-up of the latest developments:
Currently, Ethereum is trading at around $4,280, a mere 12.28% below its all-time high of $4,828, recorded in November 2021. Despite the recent pullback, the digital asset has surged over 68% in the past year, making it one of the best cryptocurrencies to buy in 2025.
However, the market is still 39% lower than its July's profit-taking peak. This dip has not deterred long-term Ethereum investors, as indicated by Glassnode's long-term holder Net Unrealized Profit/Loss (NUPL) metric. According to the metric, long-term Ethereum investors have made a psychological leap from "capitulation" to "belief" this August.
This shift in sentiment is also reflected in the behaviour of Ethereum holders. The gap between short-term and long-term holders is widening, with short-term traders increasingly taking profits, while long-term holders remain confident and continue holding their ETH.
Short-term holders (holding ETH for less than 155 days) are realizing profits at a rate of around $553 million per day in August 2025, close to July’s peak of $771 million daily profits when ETH was under $3,600. On the other hand, long-term holders maintain steady profit levels and are less inclined to sell, signalling a strong conviction and belief in future gains.
This divergence creates a "tug-of-war" in market sentiment: short-term traders "take profits," while long-term holders “accumulate” or hold their positions. This dynamic is not only reflected in the current market conditions but also has implications for the future.
The widening gap implies reduced selling pressure from long-term holders, which helps support ETH price stability or potential upward movement. Short-term profit-taking can cause temporary price pullbacks but also cleanses weaker hands, potentially setting a base for stronger price rallies later.
On-chain data shows a decline in ETH supply on exchanges and significant staking locking up liquidity (30% staked), further reducing available sell supply and underpinning price strength. ETH is reaching high profitability levels, with nearly 80% of supply in profit, incentivizing holders to keep rather than sell, which supports longer-term price appreciation.
In terms of impact on ETH price, the behaviour of long-term holders holding steady while shorts take profits during price consolidation creates a bullish setup. This is reflected in recent breakouts above key resistance levels and bullish technical patterns like the golden cross.
Institutional inflows and macro tailwinds (lower inflation, ETF growth) reinforce upward momentum, fueling hopes for substantial price targets such as $6,000 to $10,000 in the coming months. The filling of CME futures gaps and liquidation of short positions suggests a potential rebound phase after recent corrections near $4,000 to $4,200 support levels.
In summary, the widening gap between Ethereum short-term profit-taking and long-term holder conviction highlights a market in transition, with long-term holders driving supply constraints and underpinning bullish fundamentals. This dynamic supports scenarios of price consolidation followed by potentially strong rallies as weaker short-term traders exit and institutional interest grows.
As always, it is essential to verify information and consult with a professional before making decisions based on this content. The article aims to deliver accurate and timely information but should not be taken as financial or investment advice.
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Technology plays a significant role in the everyday trading of Ethereum (ETH), with its blockchain underpinning the smart contract functionality that attracts investors.
Investing in Ethereum long-term requires a solid understanding of market dynamics and technology trends, as informed decision-making is key to maximizing profits and minimizing risks.
