Another remarkable threshold has been crossed in the Bitcoin market. According to Glassnode data, the bitcoin supply in loss exceeded 10 million BTC and reached approximately 10.5 million BTC. With the price falling to $61,300 on Thursday, it was seen that more than half of the total supply in circulation moved into the unrealized loss zone.
Supply at a loss took the lead
While the total amount of bitcoin in circulation is approximately 20 million BTC, the supply held in profit in the current table has decreased to approximately 9.8 million BTC. Thus, for the first time in the current market cycle, the amount of bitcoin in loss exceeded the amount held in profit. Data indicates that the cost of a large portion of the market remains above the current price.
Glassnode data showed that for the first time this market cycle, the out-of-the-money supply of bitcoin exceeded the in-profit supply.
Examining past cycles, such transitions have often occurred during periods of harsh bear markets and, in some cases, coincided with significant lows. However, it seems difficult to evaluate this signal as a timing tool alone; because the duration of similar periods differed markedly in previous years.
Duration has changed in past cycles
In the 2015 bear market, the supply at a loss and at a profit remained close to each other for a long time, and this balance was maintained for about a year. In 2019, a similar outlook lasted for about six months. During the harsh sales wave caused by Covid in March 2020, this period was limited to approximately one month. In the 2022 bear market, the same condition continued again for approximately six months.
While this chart reveals that the current signal has historically been associated with bottoms, it does not give a clear timeframe for how long Bitcoin can stay at the lows. The direction of the pressure on the market, as well as how long this pressure will last, remains uncertain.
$61,300 and $54,000 levels are being watched
Another factor that increased the importance of the recent pullback was that Bitcoin touched the 200-week moving average at approximately $61,300. This indicator is known as a long-term trend measure based on the average price of the last 200 weeks and has stood out as a strong support point in previous bear markets.
Mini dictionary: Realized price refers to the average acquisition cost of all BTCs in circulation, calculated based on the price at which they last moved on the chain. The 200-week moving average is one of the technical indicators that is closely followed in the market and is used to monitor the long-term trend of Bitcoin.
If Bitcoin breaks below the psychologically important $60,000 level, the next major support zone stands out at around $54,000. This level also corresponds to the realized price. Historically, Bitcoin has traded below its realized price for a period of time during each of the major bear markets.
If Bitcoin sags below $60,000, the next important support zone could be the realized price level at around $54,000.
