Bitcoin Losses Now Equal 19% Of Market Cap, Echoing May 2022
Analytics agency Glassnode has highlighted how the present Bitcoin market ache echoes May 2022 primarily based on the development within the Relative Unrealized Loss.
Bitcoin Relative Unrealized Loss Has Shot Up Recently
As defined by Glassnode in a brand new post on X, the present construction of the Bitcoin Relative Unrealized Loss might mirror May 2022. The “Relative Unrealized Loss” is an on-chain indicator that measures the quantity of unrealized loss being held by BTC buyers as a complete as a proportion of the asset’s market cap.
The metric works by going by way of the transaction historical past of every coin on the blockchain to find out the final worth it was moved at. If this final promoting worth was lower than the present spot worth for any token, then the indicator considers that exact coin to be underwater proper now.
The precise diploma of loss carried by the token is the same as the distinction between the 2 costs. The Relative Unrealized Loss sums up this worth for all underwater cash and calculates what a part of the market cap that it makes up for. Another indicator referred to as the Relative Unrealized Profit tracks the tokens of the alternative kind.
Now, right here is the chart shared by the analytics agency that exhibits the development within the Bitcoin Relative Unrealized Loss during the last a number of years:
As displayed within the above graph, the Bitcoin Relative Unrealized Loss has witnessed an increase because the cryptocurrency’s worth has gone by way of a bearish shift in latest months. The newest crash to $60,000, particularly, induced a pointy surge within the indicator.
Currently, the Relative Unrealized Loss is sitting at a worth of about 19% because the asset trades close to $67,000. From the chart, it’s obvious that that is the very best degree that the indicator has hit since 2023. But extra importantly, the latest trajectory within the metric has regarded reminiscent to that witnessed through the bear-market transition from the final cycle.
“Current market ache echoes the same construction seen in May 2022,” famous Glassnode. The bear market of 2022 didn’t attain its backside till the FTX crash put buyers in an unrealized loss exceeding 60% of the market cap. It now stays to be seen when Bitcoin will attain a low this time round.
In another information, the market downturn that has adopted for the reason that October all-time high (ATH) has resulted within the largest drawdown in historical past for the US spot exchange-traded funds (ETFs), because the analytics agency has identified in one other X post.
At the second, Bitcoin spot ETFs are down 100,300 BTC. “Institutional de-risking has added structural weight to the continued weak spot, reinforcing the broader risk-off setting,” defined Glassnode.
BTC Price
Bitcoin has been caught in consolidation just lately as its worth is floating round $66,700.
