Punishing Losses for Cryptocurrency Holders in Bear Market
Holders of most cryptocurrencies are facing losses in the ongoing bear market that began in the first half of 2022. However, three layer-1 blockchain tokens are suffering the most among the top 20 cryptocurrencies by market cap. According to data from IntoTheBlock, over 93% of Cardano (ADA), Polygon (MATIC), and Avalanche (AVAX) holders are currently at a loss. Their average acquisition cost is higher than the current price of each digital asset.
Interestingly, only 32% of the total supply is held by addresses with over 0.1% of the circulating supply. Additionally, the majority of holders (60%) are long-term investors who have held their tokens for over a year.
Polygon (MATIC) Holders Struggling
Polygon, which initially started as a layer-2 blockchain for Ethereum, has its own ecosystem now. However, MATIC holders are experiencing the second worst holding performance among the three mentioned projects. A staggering 95% of MATIC holders are currently in the red, with none in the green. Only 5% of investors are at a breakeven position.
On the other hand, Avalanche has a slightly better distribution among large holders, with 78% holding at least 0.1% of the supply. As a newer layer-1 blockchain, the majority of Avalanche holders (69%) have held their tokens for less than a year.
Hot Take
The extended bear market has taken its toll on cryptocurrency holders, with Cardano, Polygon, and Avalanche being hit the hardest. While the majority of holders are at a loss, it’s worth noting that some long-term investors have remained confident in these projects. As the market continues to evolve, it will be interesting to see if these tokens can recover and reward their loyal supporters.
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