What Are Bitcoin HODL Waves?
HODL Waves visualize the distribution of Bitcoin supply across different age groups using on-chain data. By color-coding Bitcoin segments by their "age" (time since last movement), the chart reveals wave-like patterns that reflect market behavior.
The Y-axis represents 0–100% of Bitcoin's total circulating supply at any given time, standardized to show how holdings shift between short-term and long-term holders.
Key Insights from HODL Waves
Market Participation Trends
- Spikes in "young" coins (red/orange bands) indicate long-term holders selling to new buyers, often near market tops.
- Conversely, expanding "cold" colors (blue/green) suggest accumulation phases.
Cyclical Patterns
Historically, rapid price surges correlate with:- Short-term holder dominance (FOMO phase)
- Subsequent market corrections as "smart money" exits
Sentiment Indicators
The waves highlight psychological shifts:- Greed (red wave expansion) → Potential top
- Fear (blue wave dominance) → Accumulation opportunity
How HODL Waves Are Calculated
Bitcoin UTXOs (unspent transaction outputs) are grouped by their last movement date:
| Age Bracket | Color Indicator |
|---|---|
| <24h | Bright red |
| 1d–1w | Orange |
| 1w–1m | Yellow |
| 1m–3m | Light green |
| 3m–6m | Green |
| 6m–1y | Teal |
| 1y–2y | Blue |
| 2y–3y | Dark blue |
| 3y–5y | Purple |
| 5y–7y | Lavender |
| 7y–10y | Gray |
| 10y+ | Dark gray |
👉 Explore real-time HODL Wave data for live market analysis.
Practical Applications
- Macro Timing Tool: Identifies potential market tops when long-term holders (cold colors) reduce positions.
- Sentiment Gauge: Measures FOMO vs. accumulation phases.
- "Smart Money" Tracking: The 1yr HODL Wave chart specifically monitors coins held >1 year—a proxy for experienced investors.
FAQ Section
Q: Who created HODL Waves?
A: Developed by Dhruv Bransal of Unchained Capital.
Q: How accurate are HODL Waves for price prediction?
A: While not a precise timing tool, historical patterns show strong correlation between red wave peaks and macro tops.
Q: What's the difference between HODL Waves and RHODL Ratio?
A: RHODL compares short-term vs. long-term holder capitalization, while HODL Waves track absolute supply distribution.
Q: Where can I learn more?
A: Read the foundational analysis: Bitcoin Data Science: HODL Waves.
👉 Master crypto market cycles with advanced on-chain tools. This guide equips you to interpret HODL Waves like institutional analysts—combining data science with actionable market insights.