Bitcoin’s recent performance has shocked many investors as it dropped below the $59,100 mark, prompting a surge in recorded losses. Data from Glassnode highlights that the number of Bitcoin held at a loss has soared to a staggering 10.83 million BTC, marking a new record. This decline in value comes as the leading cryptocurrency has struggled to maintain a consistent position above the $60,000 threshold since February, frequently slipping below it on multiple occasions.
As recently as four months ago, the amount of Bitcoin in loss reached a peak of 9.8 million BTC and jumped to 10.78 million BTC in early June. Historical comparisons suggest that around 10.5 million BTC held at a loss is indicative of market bottoms, which aligns with trends observed in the bear markets of 2019, 2020, and 2022.
Breaking down the figures, it is notable that long-term holders (LTHs) are bearing a significant part of these losses. Glassnode defines LTHs as those who have held their Bitcoin for a minimum of 155 days. Currently, these long-term holders hold approximately 5.58 million BTC at a loss, which is the second-highest recorded level, second only to March 2020, when over 5.6 million Bitcoins in this category were facing losses.
Despite these losses, long-term holders now dominate the market, controlling around 14.8 million BTC, the highest figure recorded to date. With about 20 million BTC currently in circulation, these LTHs account for nearly 75% of the total available supply in the market, with 37% of that amount now valued below their purchase price.
Historically, LTHs show resilience during bear markets, often increasing their share of the total Bitcoin supply. During market upswings, they tend to capitalize on gains and sell their holdings, leading to fluctuations in market supply and demand. The current trend suggests that these long-term investors might continue to hold through this bearish phase, reflecting a strategy that has characterized many previous downturns.
