Bitcoin\u2019s latest retreat has been so severe, it has pushed more than half its circulating supply into loss-making territory.<\/p>\n
With the coin trading around $62 000 \u2014 down some 50% from its record highs \u2014 and a fresh break below its 200-week moving average, it is quickly racking up losses for a growing share of its holders. For the first time since late 2022, more than 50% of the coins trading are doing so below their purchase price, according to Vetle Lunde at K33 Research. The figure stood at just 30% a month ago.<\/p>\n
It\u2019s the latest sign of stress for a market that\u2019s been mired in a downdraft for months. Bitcoin and numerous other tokens have been selling off since October, with few positive developments able to arrest a decline that last week brought the largest token to its lowest since 2024 and wiped out all gains notched during the crypto-friendly Trump presidency.<\/p>\n
Its newest leg lower set off after Bitcoin-treasury firm Strategy announced a sale of a handful of tokens that sent anxiety swirling among traders given the importance the company has held within the crypto ecosystem. Outflows from Bitcoin-focused exchange-traded funds have accelerated, too, and volatility has spiked to a three-month high, K33 said.<\/p>\n
For Bitcoin holders \u2014 long- and short-term ones \u2014 it\u2019s been painful.<\/p>\n
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\u201cPrices move because of structural positioning, leverage, emotional reactions, and event-driven risk, but the bigger picture is a reflection of persistent market conditions,\u201d said Ophelia Snyder, who was a co-founder of the asset-management firm 21Shares. \u201cAnd until those underlying conditions change, I think we\u2019re likely to continue seeing more of the same: range-bound markets, periodic volatility, leverage resets, and a lot of investors waiting for the next truly important catalyst.\u201d<\/p>\n
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The significance extends beyond paper losses. Bitcoin\u2019s most powerful rallies have historically depended on attracting new buyers willing to pay higher prices than the previous wave of investors. When more than half of the supply is underwater, the market begins to carry the weight of millions of disappointed holders who bought into last year\u2019s enthusiasm.<\/p>\n
That can become a headwind of its own. Investors sitting on steep losses often use rallies as opportunities to exit positions rather than add to them, creating a source of latent selling pressure. At the same time, a prolonged drawdown risks damaging one of Bitcoin\u2019s most valuable assets: its reputation as a trade that reliably rewards patience. Every month spent far below its highs is another month in which a new generation of investors associates crypto less with extraordinary gains and more with missed opportunities, especially as capital chases faster-moving stories elsewhere in markets like AI chipmakers.<\/p>\n
\u201cAfter 17 years, Bitcoin still has no use case beyond pure speculation,\u201d said JonesTrading Chief Market Strategist Michael O\u2019Rourke.<\/p>\n
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On the surface, developments within the crypto space have been looking constructive, belying the angst-filled nature of the market itself. The Trump administration has been receptive toward cryptocurrencies, urging along all manner of regulation to bring the products closer into the mainstream. Traditional financial outlets have been more embracive, too, as the investor base has broadened. And all manner of projects are finally being built on top of crypto rails, a vision that digital-asset proponents have long advocated for.<\/p>\n
But the reality on the ground has been much bleaker. A roster of Bitcoin exchange-traded funds trading in the US has seen some $5.5 billion in outflows over the past month, according to data compiled by Bloomberg, further pressuring the underlying price. Meanwhile, total volumes across centralized exchanges last month slumped month-over-month to $4 trillion, marking the second consecutive month for the figure to be at the lowest levels in nearly two years, according to a report from Cantor\u2019s digital assets research team.<\/p>\n
Still, Lunde at K33 might have found a silver lining amid the bad-news deluge. Historically, half of Bitcoin trading \u201cunderwater\u201d has only been seen near major bear-market bottoms \u201cas selling pressure from profitable holders becomes increasingly exhausted.\u201d In the past, the coin has tended to bottom within weeks of crossing that level, though it has also been known to suffer through an additional \u201cfinal leg lower,\u201d Lunde wrote in a note.<\/p>\n
\u201cWhile not a guarantee, the setup suggests downside may be limited relative to the potential upside over the coming year, strengthening the case for a contrarian bullish bias,\u201d he said.<\/p>\n
\u00a9 2026 Bloomberg<\/p>\n<\/p><\/div>\n
#Bitcoin #selloff #leaves #supply #trading #loss<\/p>\n","protected":false},"excerpt":{"rendered":"
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