According to fresh data from Glassnode, bitcoin is down roughly 55% from its November high, and 40% of holders are now underwater on their investments.
When you exclude short-term investors who purchased bitcoin in the last six months when the price was about $69,000, the percentage rises even more.
In the previous month alone, 15.5 percent of all bitcoin wallets have experienced an unrealized loss as the world’s most popular cryptocurrency plummeted to $31,000, matching the decline in tech stocks. The strong link between Bitcoin and the Nasdaq calls into question the cryptocurrency’s role as an inflation hedge.
During this last sell-off, Glassnode analysts noticed an inflow of “urgent transactions,” in which investors paid higher fees, indicating that they were ready to pay a premium for faster transaction times.
Over the recent week, the total value of all on-chain transaction fees paid hit 3.07 bitcoin, the highest amount ever recorded in its database.
“The dominance of on-chain transaction fees associated with exchange deposits also signalled urgency,” the paper stated, bolstering the idea that bitcoin investors were looking to de-risk, sell, or add collateral to their margin positions as a result of recent market turbulence.
Over $3.15 billion in value moved into or out of exchanges during the sell-off last week, the most since the market set its all-time high in November 2021.
According to the survey, most wallet cohorts, “from shrimp to whales,” have slowed their on-chain accumulation tendencies, referring to both small-scale and large-scale investors.
Over the previous few weeks, wallets with balances of more than 10,000 bitcoin have been a particularly powerful distribution force.
While retail investors are more confident — those with less than 1 bitcoin are the strongest accumulators, according to data – the accumulation among these smaller-scale holdings is significantly lower than it was in February and March.
Fundstrat Global Advisors predicts a bottom of roughly $29,000 per coin, and investors should acquire one-to-three month put protection on long positions.
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