Bitcoin (BTC) has dropped roughly 50% from its all-time high, with long-term holders’ average profits shrinking to about 74% as the proportion of coins held at a loss reaches nearly half amid ongoing months of selling pressure.
Long-term investors in Bitcoin still maintain an average profit margin close to 74%, but this advantage is steadily diminishing as the price approaches their break-even point around $39,000.
The cryptocurrency has recorded almost five consecutive monthly declines following a surge in volatility exceeding 150%. Meanwhile, the weekly Relative Strength Index (RSI) indicates one of Bitcoin’s most oversold conditions near the $60,000 to $65,000 range.
Currently, approximately 10 million BTC—about half of the total circulating supply of 20 million—is underwater. This level of capital erosion historically aligns with market bottoms during bear cycles.
According to CryptoQuant analyst Darkfost, long-term holders typically endure periods where prices fall below their cost basis by around 20%, triggering capitulation phases marked by realized losses. These investors are generally less reactive to short-term price swings and tend to hold through volatility.
Historically, market recoveries and transitions into bullish trends have followed these capitulation events after significant loss realization among long-term holders.
Blockchain analytics firm Glassnode highlights that the 90-day moving average for Realized Profit/Loss Ratio has dipped below one. This signals a phase dominated by excessive loss realization—a bearish environment that tends to last at least six months before liquidity returns robustly into markets.
Analyst James Check points out that Bitcoin’s recent performance includes nearly five straight red monthly candles post an unprecedented spike in volatility within this cycle. The weekly realized volatility surged past 150%, often linked with capitulation moments. Additionally, weekly RSI readings show extreme oversold levels rarely seen before in Bitcoin’s history. Notably, many Bitcoins have changed hands recently at elevated price points throughout this year.
James Van Straten reports that BTC supply currently held at a loss stands near its fourth-highest historical level: about ten million coins or half of all circulating units ahead of reaching twenty million total next week. Such substantial capital destruction typically marks bear market troughs based on past patterns.
This morning’s early Asian trading session saw a slight rebound for Bitcoin; however bearish momentum remains strong overall as prices form lower highs while key support zones continue holding firm according to technical analysis insights.