Current Data Shows Bitcoin Holders Sit On 8M BTC Loss

By Kevin • December 27, 2022 2:03 pm • Comments

The data on Bitcoin holders is now showing something impressive that has not been seen before in crypto history.

Basically, data is showing that there is an extremely high amount of Bitcoin wallets that is now holding Bitcoin at a loss when compared to the current market value of Bitcoin.

The number of wallets included in this data indicates that both long term and short term investors have been affected negatively by the continued bear market.

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Yet, surprisingly, there is still a lot of strong optimism in the market that the asset will eventually rebound on a long enough time scale.

Many believe that the collapse of the FTX is actually good as it removes a lot of bad actors from the crypto industry which leaves more room for growth for genuine players.

Cointelegraph reports:

Since the FTX meltdown sent crypto markets tumbling, BTC/USD has failed to recover.

Its descent to levels last seen two years ago has created problems for hodlers who bought in more recently — logically, they are nursing negative returns on their positions.

The pain runs deeper than that, however, and Glassnode now shows the extent of unrealized losses plaguing newcomers and old hands alike.

For both short-term holders (STHs) and long-term holders (LTHs), current BTC price levels are a nightmare. STHs and LTHs are defined as entities hodling incoming coins for less than or more than 155 days, respectively.

According to the latest figures, as of Dec. 26, STH Bitcoin held at a loss totaled 1,889,585 BTC, with the LTH tally at 6,057,858 BTC.

As far as what the future of Bitcoin holds, there is still much uncertainty on what it will do and when experts believe that the bear market will finally come to an end.

Some investors believe that the bear market will still continue and that the bottom may be around the price range of around $10,000 sometime in 2023.

One important thing to note when it comes to predicting the end of bear markets is to look at how far the price had retracted from its all time highs in the previous crypto bull runs.

For example, back in 2017/2018, the price of BTC had retracted around 80% from its all time highs so it may be reasonable to assume that something similar may happen again.

So far, the price of BTC has not yet reached the 80% threshold which may mean that there is still some room to go.

PaySpaceMagazine concludes:

The unrealised loss amount is record-breaking, as the percentage of Bitcoin supply held in self-custody is unprecedented. FTX bankruptcy taught crypto investors they couldn’t trust even big household industry names with their crypto assets. Therefore, exchange outflows have increased across all BTC wallet sizes “from shrimp to whales”.

Moreover, the losses of Bitcoin investors may as well increase next year. Many analysts suggest that a new BTC price bottom will be about $10,000. The decline may potentially happen as soon as Q1 2023.

Considering its retracement from all-time highs, Bitcoin still has much room to fall. It has not yet breached the 80% threshold common to previous bear markets.

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