Ethereum's Average Hold Time Is 2.4 Years - IntoTheBlock
Latest insights by IntoTheBlock has revealed that the average time Ethereum is being held is 2.4 Years.
"With an average holding time of 2.4 years, $ETH signals strong confidence from long-term holders," wrote IntoTheBlock on X.
What you should know
As we can see from the chart above, there was dominance of Cruisers (medium-term holders) and Traders (short-term traders) from 2016 to 2019 largely due to the fact that ETH was still in its formative years (remember it was launched in 2015).
That doesn't mean ETH didn't have anything go for it at the time. In fact, the ICO boom which peaked around 2017-2018 saw a surge in new projects and tokens being launched on Ethereum.
However, participants were mostly interested in flipping their tokens for quick profits, leading to dominance of short-term trading behavior.
It wasn't until July 2019 that Holders began dominating, a period when the market bottomed with many short-term traders and speculators exiting the market.
Those who remained adopted a long-term perspective, believing that the worst was over and that Ethereum had strong fundamentals for future growth.
They prolly bought into Ethereum 2.0 proposals and the promise that a transition from PoW to PoS held.
Fast forward to date, ETH has more holders, Many of whom were on-boarded by the DeFi summer of 2020 and locked in with staking/yield opportunities.
With future upgrades, institutions now building on ETH and RWAs making ETH their favorite platform, we can expect that the average hold time will tremendously increase in the next decade.
However it won't be a smooth sailing as IntoTheBlock notes that:
"A lack of new short-term participants and the emergence of L2s and alternative L1s are fragmenting attention, leaving growth potential somewhat tempered."