As selling pressure continues in Bitcoin, on-chain data revealed that the market is approaching a threshold again that has been associated with bottom zones in past cycles. According to the latest data, more than 40 percent of the Bitcoin supply in circulation is in a loss position. This ratio shows the amount of coins for which the price has fallen below the purchase cost.
Loss-making supply in Bitcoin has increased
According to data shared by CryptoQuant, the portion of Bitcoin supply held at a loss has exceeded 40 percent. CryptoQuant is known as a market research platform that analyzes on-chain data. The increase in this indicator indicates that Bitcoin held by many investors is now traded below its purchase cost.
CryptoQuant data showed that more than 40 percent of the circulating Bitcoin supply is currently in a loss position, indicating a convergence towards areas where the market has formed bottoms in previous cycles.
The metric in question measures how much of the coins in the market remain below the level at which they were purchased. The increase in the rate shows that not only short-term investors but also some wallets with larger positions are losing their gains on paper.
Below 70 thousand dollars attracted attention
This shift in the data became more visible after Bitcoin lost the support around $70,000. The price remaining below this level seems to have accelerated the clearing of short-term and more speculative positions from the market.
At the time the news was being prepared, Bitcoin was trading at $68,834. This corresponds to a decrease of 4.15 percent in the last 24 hours. The increase in the loss-making supply rate along with the decline in price is also closely monitored in terms of investor psychology.
Similarities are made with historical bottom regions
According to the analyst, in previous market cycles, Bitcoin bottoms occurred during periods when the supply in the loss position reached approximately 60 percent. For this reason, the current picture is evaluated as a structure similar to the bottom formations seen in the past may be developing.
However, it is not clear whether the same threshold will be repeated exactly in the current cycle. In the evaluations, the possibility that the extreme movements in the past have become more limited over time and therefore the market may find balance at lower rates is highlighted.
Nevertheless, the fact that this indicator pointed to a possible bottom zone created some relief for investors despite the increasing loss rate. Historical data shows that such periods often occur when sales are weakening and the market is approaching fatigue.
