Bitcoin STH Realized Losses Far From 2021 Levels — Is The Bull Run Still On?

The price of Bitcoin has been stuck within the $81,000 to $86,000 consolidation range over the past week, showing a high level of indecisiveness between the bulls and bears. While most on-chain indicators are painting a bearish image for the premier cryptocurrency, the latest piece of data suggests that the bull run might not be over just yet.

BTC Investors Not Yet In Full Panic Mode: Blockchain Firm

In a new post on the X platform, blockchain analytics firm Glassnode revealed that a specific class of Bitcoin holders known as the “short-term holders” (STH) are facing increasing market pressure. This on-chain observation is based on the value of unrealized losses of this investor cohort.

For clarity, an unrealized loss refers to one that is still on paper, as the investor is still holding on to and selling an asset (with a declining value). A loss only becomes “real” or “realized” when the holder sells the asset at a value lower than the purchase price.

According to Glassnode, the unrealized losses of Bitcoin investors have been climbing in recent weeks, specifically pushing the short-term holders toward a significant +2σ threshold. The STH Relative Unrealized Loss metric hitting the extreme +2σ threshold has been associated with increased selling pressure in the past.

However, Glassnode noted that the size of the STH losses still falls within the range typically observed in a bull market. Specifically, the magnitude of these losses pales in comparison to the market-wide sell-off witnessed in 2021, suggesting that the bull cycle might not be done yet.

To further illustrate this, Glassnode revealed that the rolling 30-day realized loss for Bitcoin’s short-term holders has now surpassed $7 billion, representing the largest sustained loss event in the current cycle. Despite the significance of this figure, it is still far less severe than the capitulation events seen at the start of past bear markets.

For instance, Bitcoin’s realized losses rose to as high as $19.8 billion and $20.7 billion during the major price corrections in May 2021 and 2022, respectively. Considering that the realized losses are still well below past capitulation events, there is a chance that the market has not yet reached a full-scale panic mode.

Bitcoin Price At A Glance

As of this writing, the price of Bitcoin stands at around $84,300, reflecting a 0.3% increase in the past 24 hours. According to data from CoinGecko, the flagship cryptocurrency is down by merely 0.6% in the past seven days, emphasizing the choppy state of the market.