Short-term Bitcoin holders are locking in losses at a scale not seen since the early stages of this market cycle, signaling a crucial test of sentiment in an otherwise bullish trend.
Over the past 30 days, realized losses for this group have reached $7 billion, according to data from Glassnode—marking the largest loss-taking event since the last major downturn.
While the $7 billion figure is substantial, it remains well below previous cycle peaks. In May 2021 and June 2022, realized losses soared to $19.8 billion and $20.7 billion, respectively. The current numbers suggest a partial exit strategy rather than a full-blown panic.
Glassnode defines short-term holders (STHs) as investors who acquired Bitcoin within the past 155 days. Often more reactive to volatility, this group is typically the first to sell under pressure.
Recent data indicates that STHs are experiencing elevated relative unrealized losses, nearing the +2 standard deviation mark—a threshold historically associated with acute stress.
However, losses have not crossed into capitulation territory. Glassnode noted that the losses, while elevated, “remain largely in line with the yen-carry-trade unwind on 5-Aug-2024.” The implication is that new investors are under pressure but not yet fleeing en masse.
Market Structure Adds to Downward Pressure
Bitcoin was trading at $84,322 at press time, positioned below its 50-day moving average of $85,141 and the 200-day average of $95,174. These technical indicators now act as resistance levels, with the market showing limited momentum to break higher. Sentiment among short-term holders remains fragile.
The combined weight of rising unrealized and growing realized losses has elevated Bitcoin’s risk profile, particularly for investors who bought at recent highs. Historical context, however, shows that similar market conditions have occurred within bull cycles. The losses, while notable, remain within the expected parameters for such phases.
The market’s ability to stay above key psychological levels—especially the $83,000 and $85,000 thresholds—will likely determine the next move.
Should Bitcoin reclaim and hold the $85,000 level, confidence among short-term holders could return. A failure to do so, especially if prices fall below $83,000, may trigger further selling pressure, potentially testing lower support zones near $80,000.
