Recent on-chain data from analytics firms Glassnode and CryptoQuant indicates that Bitcoin has not yet reached the typical levels of investor capitulation seen at previous market cycle bottoms, tempering hopes that the current downturn is near its end. The analyses come as BTC slipped below $70,000 for the first time since April, pressured by a sale from institutional holder Strategy.
Glassnode: Long-Term Holders Sit on Modest Unrealized Losses
According to Glassnode’s Relative Unrealized Loss metric, long-term holders (those who have held for at least 155 days) are currently nursing an unrealized loss of about 15.5% of their portfolio value. That means for every dollar of value, they are looking at roughly 15.5 cents in paper losses. While uncomfortable, this pales in comparison to the extremes of past bear markets, where the metric exceeded 50 cents on the dollar before a durable bottom formed. In other words, previous cycle lows required long-term holders to absorb unrealized losses greater than 50%—a level nearly three times the current reading. The data suggests that the market has not yet endured the deep washout that historically resets cycles.
CryptoQuant: Over 40% of Supply Now in Loss, But Still Not Enough
Separate data from CryptoQuant paints a slightly more stressed picture but arrives at a similar conclusion. Following the price decline, the percentage of Bitcoin’s total supply held at a loss has climbed to 40.6%, according to analyst Julio Moreno. He noted that in past bear markets since 2015, major bottoms were typically accompanied by more than 60% of supply being under water. While that threshold has gradually declined in successive cycles—reflecting structural changes in the market—the current 40.6% still remains below the upper limit of the long-term downtrend line that historically signaled a bottom. Moreno stated, “Based on past data, this ratio is still not enough for us to see that the price has bottomed out.” He added that if the Bitcoin price weakens further or moves sideways, the supply-in-loss metric could retest the critical trend line, which might finally indicate a buying opportunity of the kind seen at prior cycle lows.
Implications for Investors
The convergence of these two independent on-chain signals—moderate long-term holder unrealized loss and a sub-60% supply in loss—implies that the selling pressure and financial pain required to flush out weak hands may not have fully materialized. Historically, prolonged periods of sideways price action and gradual erosion preceded the final capitulation, rather than sharp V-shaped recoveries. While the metrics are not a guarantee of further downside, they serve as a reminder that calling the absolute bottom prematurely is risky. Investors are advised to monitor on-chain indicators alongside macroeconomic factors to build a more complete picture of cycle positioning.
