The Bitcoin RHODL ratio rises to the third-highest in history, possibly indicating that Bitcoin's bottom has been formed.

ChainCatcher reports that, according to CoinDesk, Glassnode’s on-chain Bitcoin indicator RHODL Ratio is currently at 4.5, the third-highest level on record, and its signals are more consistent with a market bottom rather than a cycle top.

The RHODL Ratio compares the value proportion of Bitcoin held by long-term holders (holding for 6 months to 3 years) versus short-term holders (holding for 1 day to 3 months). An increasing ratio typically reflects longer holding periods and reduced speculative activity, rather than an influx of new buyers—this dynamic has appeared after significant pullbacks in 2015, 2019, and 2022. Over the past six months, during which Bitcoin has fallen 50%, many young speculative coins have been wiped out, with wealth concentrating among long-term holders.

Historically, the RHODL Ratio has only exceeded current levels twice: in 2015 (ratio of 5) and in 2022 (ratio of 7), both corresponding to cycle bottoms, indicating that Bitcoin may still have further downside potential. However, pushing the ratio to higher levels generally requires near-complete inactivity from short-term holders, a condition not yet evident—Bitcoin has rebounded about 25% from its February lows, perpetual contract funding rates remain negative, and the S&P 500 has also hit new all-time highs.

Overall, this indicator suggests that the current market condition is more akin to a correction within a cycle rather than a cycle top, and the re-domination of long-term holders may signal that a phase bottom is approaching.