The Impact of the Sell-Off on Short-Term Bitcoin Holders
The recent sell-off in the crypto market has had a significant impact on short-term Bitcoin holders. Here are the key points:
– Short-term holders are experiencing losses: The sell-off has pushed prices below the cost basis for short-term Bitcoin holders, resulting in unrealized losses. Over 88.3% of the supply controlled by short-term holders is currently underwater, with only 11.7% still in profit.
– Long-term holders remain unaffected: Unlike short-term holders, long-term holders have remained unfazed by the market volatility. This is a common trait during bear market recovery periods.
– Decline in profit dominance: As the rally progressed, there has been a consistent decline in profit dominance for short-term holders. This suggests that they acquired coins with an increasingly elevated cost basis.
– Psychological standpoint: The market is currently in a somewhat “precarious” position from a psychological standpoint, with the Realized Price and the Long-Term Holder cost basis trading below the short-term holder cost basis.
– Speculation of more downside: Some analysts speculate that Bitcoin may experience further lows, with the price potentially dropping to $12.5k.
Hot Take:
The sell-off has hit short-term Bitcoin holders hard, with a majority of them facing unrealized losses. While long-term holders have remained resilient, the market’s psychological state is in question. Speculations of more downside add to the uncertainty surrounding Bitcoin’s future.
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