Bitcoin Long-Term Holders Record 14% Loss, But Significantly Short of Bear Market Bottom Levels

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The unrealized loss of long-term investors in the leading cryptocurrency, Bitcoin (BTC), who are holding on with steadfast belief, has swelled to 14% of the market capitalization. However, when compared to the bottom periods of past severe downtrends, it still appears to be significantly low, creating a subtle tension about potential further adjustments in the future.

According to the cryptocurrency media outlet Bitcoinist on April 11 (local time), on-chain analytics firm Glassnode diagnosed via social media X that the unrealized losses of long-term investors holding Bitcoin for more than 155 days have recently increased noticeably. This group of long-term investors, often referred to as "diamond hands," also could not entirely avoid the deep downward wave across the virtual asset market that began in the fourth quarter of last year.

Unrealized loss, a key indicator for gauging the impact on investors, is calculated by comparing the last transfer price of all circulating coins with the current spot price. In particular, examining the 30-day simple moving average of the relative unrealized loss indicator for long-term holders, which shows the loss ratio relative to market capitalization, the number has consistently shown an upward curve in recent months as prices declined and quantities purchased at highs transitioned into long-term holdings.

Currently, this indicator stands at 14%. This means that the losses borne by long-term investors who steadfastly support the market amount to 14% of Bitcoin's total market capitalization, suggesting this is the most extreme period of pain faced by this group since 2023.

However, past historical data sends a chilling warning in a completely different direction. During the two previous brutal bear markets, this relative unrealized loss indicator surged to around 70% at the bottom, indicating extreme capitulation. While it's uncertain if this cycle will demand the same level of pain as the past, the current figure of 14% being still significantly lower than past bottom levels carries a weighty implication that there may be further downside potential.

Despite the heavy warning from these on-chain indicators, Bitcoin's price is testing strong resilience, recovering above the $72,000 mark, bolstered by the recent rebound rally.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. This content should be interpreted for informational purposes only.*