The intensity of realized losses among Bitcoin's short-term holders has cooled significantly since a sharp spike in early February, but the broader market structure remains under pressure. Data from Glassnode shows the 7-day exponential moving average (EMA) of the Short-Term Holder (STH) Net Realized Profit/Loss metric plunged to a daily loss of -$1.24 billion on February 6, marking one of the most aggressive capitulation events of the current cycle.
Since that peak, the metric has moderated, improving to roughly -$0.48 billion per day by February 23. This represents a 61% reduction in loss intensity over 17 days, signaling that the most extreme forced selling has slowed. However, the persistence of negative values indicates that short-term holders are still, on aggregate, realizing losses rather than profits, a pattern consistent with ongoing market stress and base formation rather than a confirmed recovery.
Meanwhile, derivative markets showed heightened stress. Funding rates turned negative to -0.038%, and liquidations surged by over 450% to $473 million. Open Interest also declined toward $96 billion, reflecting a broader unwinding of leverage across the market.
A critical divergence emerges in the data: while realized losses are cooling, a massive overhang of unrealized losses persists, particularly among whale-sized recent entrants. These large holders saw unrealized losses peak at approximately $32 billion on February 6 and still hover near $26 billion as of the latest data. This suggests that despite reduced selling pressure, the market structure remains fragile, with stability dependent on the conviction of these underwater holders not to distribute their positions amid volatility.
