With short-term holders driving Bitcoin’s sell-off, realized losses are hitting historic levels, leaving investors to wonder where the bottom might be.
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Bitcoin has taken a slide back to its April level of around $83,000, with mounting selling pressure prompting many investors to sell at a loss, reminiscent of major historic market crashes.
Realized losses on Bitcoin () have surged to levels not seen since the 2022 FTX collapse, to blockchain data platform Glassnode.
“The scale and speed of these losses reflect a meaningful washout of marginal demand as recent buyers unwind into the drawdown,” Glassnode in an X post on Friday.
Glassnode’s observation came minutes before Bitcoin as low as $80,500 on Coinbase, marking a 36% decline from its all-time high of $126,210 recorded just weeks ago in early October.
Short-term holders driving the capitulation
According to Glassnode, a big chunk of selling in the ongoing Bitcoin crash is due to short-term holders.
Data from analytics platform CryptoQuant shares a similar perspective, noting that short-term selling “often marks a local bottom if the price quickly reclaims the cost basis.”
“Failing to do so historically indicates a deeper bearish trend or confirms a bear market,” CryptoQuant wrote on X on Thursday.
Although many market observers say the current downturn could signal the , prominent industry figures such as Jan3’s Samson Mow have cast doubt on the onset of a crypto winter.
“How can we have a bear market when we haven’t even had a proper bull market?” Mow in a post on X on Thursday, referring to growing caution across the market.
Where is the bottom?
With Bitcoin in the red for four straight weeks and the Crypto Fear & Greed Index into “Extreme Fear,” the question of how low BTC could fall has become a major concern.
“We’ve been slicing through support levels like butter lately, and nobody seems to want to try and catch the knife,” Quantum Economics CEO Mati Greenspan told Cointelegraph, adding:
“While I utterly reject the notion that we’re heading into a multi-year bear market, with the speed of the current meltdown, the bears may hit their targets much sooner than expected.”
The collapse of FTX in November 2022 came on the heels of the six months earlier, as Bitcoin dropped from around $33,000 in May to below $16,000 by November. Some observers , speculating that FTX’s liquidity crisis may have begun earlier than publicly disclosed.
After bottoming out at around $15,700, the BTC price had remained below $20,000 for two months before starting its path to the bull market that began in 2023, to CoinGecko data.
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According to some major industry bulls, a market bottom could arrive within a similar time frame this time.
Tom Lee, co-founder of Fundstrat Global Advisors and head of Ether () treasury strategy at BitMine, has that Bitcoin could rebound to between $150,000 and $200,000 by the end of January 2026.
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