Bitcoin’s recent struggle since dipping below has seen more of the coin’s supply shift from a position of profitability, with 30%+ of supply in a loss.
The cryptocurrency is trying to bounce above support-turned-resistance level around $38k, having fluctuated to lows of $36,350 amid broader market sell-off early Tuesday,
According to on-chain analytics platform Glassnode, the steady declines since the all-time highs of $69k have sucked more than 30% of supply into losing positions.
Glassnode notes that the drawdown in BTC value over the past week sent the percentage of Bitcoin entities in profit to lows of 65%. The figures have since swung to and from highs of 76%, the firm added in a report.
More than 10% bought BTC at $33.5k-$44.6k
Per the Glassnode data, 10.9% of the BTC entities acquired their holdings between $33,500 and $44,600. At current prices, many of them could still be in profit and thus keep those in a loss just above the 30% mark.
However, with current market conditions presenting several headwinds, it’s possible another sharp fall could see these entities sink into the “loss” bracket.
The group of BTC holders who bought in the $33k-$44k range “are statistically the most likely to become yet another source of sell-side pressure,” Glassnode observed in its report.
This will likely be the scenario if Bitcoin’s price goes on to trade below these entities’ cost basis.
Pointing to the above possibility, analysts at the firm point to a weakness in both Bitcoin and traditional markets. They believe the risks and uncertainty around the markets remain elevated amid fears around Fed rate hikes and an escalation of the conflict in Ukraine.
Bitcoin price is currently hovering around $38,000, up 0.1% in the past 24 hours. However, the BTC-USD pair remains over 10% down in the past week.
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