Bitcoin’s continuing price weakness is pushing long-term holders toward a critical pain threshold, according to market analysts. Data indicates the average profit for this key cohort has declined to roughly 74% as the price nears their aggregate cost basis of approximately $38,900. Historically, a break below this level has triggered a final capitulation phase, a pattern some analysts believe is necessary before a market recovery can begin.
Bitcoin prices continue to weaken, approaching pain levels for long-term holders. Analysts are examining the behavior of different investor cohorts as markets fail to improve.
CryptoQuant analyst ‘Darkfost’ stated that “One of the cornerstone cohorts in this framework is long-term holders (LTH), known to be less sensitive to short-term price fluctuations.” The profit margin for these holders continues to decline toward their cost basis, currently estimated near $38,900.
Historical cycles show each bear market has been characterized by the price breaking below this cost basis. This triggers a final capitulation phase marked by realized losses of around 20%, according to the analyst.
Glassnode reported the 90-day moving average of the Realized Profit/Loss Ratio has fallen below 1. This confirms a full transition into an “excess loss-realization regime” that historically persists for at least six months.
Analyst James Check observed Bitcoin has nearly printed five consecutive red monthly candles. This followed the largest volatility spike of the cycle, with 1-week realised volatility spiking above 150%.
Check also noted weekly RSI is at one of the most oversold readings in Bitcoin’s history. Approximately $70 billion worth of BTC has migrated to new hands in the $60,000 to $70,000 range this year.
Supply in loss just hit 10 million coins, the fourth-highest reading ever according to analyst James Van Straten. He added that the circulating supply hits 20 million BTC next week, with 50% in loss.
Van Straten stated, “History suggests that’s enough capital destruction for a bear market bottom.” Bitcoin saw a minor rebound during early Asian trading, adding $2,000 to reclaim $66,000. However, the move does not appear natural, with bearish sentiment remaining dominant.
