Bitcoin price is struggling near $60,000 as Glassnode says more than 95% of recent buyers are now sitting on losses.
The price of Bitcoin has entered an even deeper stage of capitulation, with newly acquired coins going underwater, realizations increasing and demand dwindling.
In a June 10 market report, analysts at blockchain firm Glassnode noted that the Bitcoin price had dipped below $60,000 because profit margins were falling while options traders continued to pay premium prices for insurance.
The firm said its AVIV z-score, which measures Bitcoin’s valuation relative to its long-term historical averages on chain, has dropped to as low as -1.09 before reaching a current level of -1.06, meaning Bitcoin was “deep within the extreme discount band” compared to its cyclical average.
Additionally, price action failed to show strong resistance at the level, indicating “persistent fear in sentiment.”
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Buyers Sink Into Losses
With the price now trading around $62,000, Bitcoin’s short-term holders are under heavy pressure, the analysts say.
According to them, the MVRV of short-term holders of Bitcoin had dropped to 0.81 and subsequently recovered to 0.83, implying that new investors had lost about 18% of their investment on average. The analysts explained:
“In practical terms, more than 95% of the recent buyer cohort is currently underwater. Readings of this magnitude fall within the significant capitulation band historically, where broad-based stress among new investors leaves the market structurally fragile and highly vulnerable to any negative external catalyst.”
As Glassnode explained, the current sideways move seems more like an “exhaustion pause rather than a stabilized floor,” because profitability hasn’t recovered much.
Demand Support Fades
The selling has even started appearing in losses, as per Glassnode, since the short-term holder SOPR z-score, which measures how much the recent buyers have started selling in losses, fell to -1.86, almost reaching the -2 mark that traditionally indicates severe capitulation.
Despite all of the above, Glassnode believes that ultimate capitulation intensity, which precedes long-lasting relief rallies, has not yet occurred, as there has been no substantial demand reaction from the market.
The lack of demand isn’t only seen on a blockchain level. The Coinbase Premium remains negative, implying the demand from U.S. exchanges has waned significantly.
Furthermore, corporate treasury purchases have also slowed down, thus depriving the market of additional support. Bitcoin Foundation reported earlier that the market value of Bitcoin treasury stocks has nearly halved from about $134 billion in early October to $72 billion, erasing roughly $62 billion.
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