Majority of investors reap rewards as bitcoin's support level solidifies, with seven in ten holding gains.

A profound transformation is underway in the bitcoin market, with a staggering 4 million BTC now held by long-term investors, dubbed "conviction buyers," according to data from BitGo, as reported by Bitfinex on Wednesday. This significant accumulation has resulted in a 300% increase in bitcoin held by long-term buyers since the end of 2025, indicating a substantial shift of the cryptocurrency's realized value into the hands of large, low-activity players.

The aggregate value of this "conviction capital" stands at approximately $320 billion, based on the current bitcoin price of around $80,000. Market analyst and founder of Quantum Economics, Mati Greenspan, notes that while the specifics of BitGo's methodology for determining "conviction buyers" may not be immediately clear, the broader trend is noteworthy, as periods of dwindling liquid supply coupled with renewed demand have historically created an environment conducive to substantial price increases.

This uptrend in conviction buying marks the most substantial two-quarter surge since the COVID-19 pandemic in 2020, as highlighted by Bitfinex. These long-term investors, whether individual or institutional, are characterized by their low-activity profiles. Notably, the 5.6 million BTC that have remained dormant for over a decade, as highlighted by core bitcoin developer Jameson Lopp, are not part of the estimated holdings of these conviction buyers. The total circulating supply of bitcoin currently stands at 20.03 million, according to data from CoinDesk.

Analysts at Bitfinex have observed a growing proportion of bitcoin's realized value being absorbed by entities that rarely engage in transactions, regardless of market volatility. This structural shift suggests that long-term holders, including institutional investors and corporate treasuries, are aggressively acquiring available bitcoin supply. A prime example is MicroStrategy (MSTR), the largest publicly traded corporate holder of bitcoin, which has recently increased its holdings to 818,869 BTC, representing an unrealized gain of $4.6 billion.

When bitcoin supply is transferred to these low-activity entities, it effectively reduces the liquid supply available on the open market, potentially creating a "supply shock" dynamic. Research from CEX.IO supports this narrative, revealing that nearly 70% of recent buyers are now in profit, a metric that can serve as a psychological buffer against sell-offs. As a result, new bitcoin investors are less likely to exit their positions during minor price pullbacks, contributing to market stability.

According to Ran Hammer, vice president of Business Development at Orbs, the growing trend of borrowing against BTC holdings has altered the supply equation, with more bitcoin being structurally removed from the market. In a separate comment, Connor Howe, CEO and co-founder at Enso, believes that the long-term scarcity narrative of bitcoin is evolving from a theoretical concept to a market reality, driven by institutional accumulation and ETF flows. As a result, a larger proportion of supply is moving into the hands of conviction buyers, which could make future scarcity more pronounced when demand accelerates.