Bitcoin’s price has continued to struggle in the last quarter of the year, recently dipping below its 2025 entry point. According to the latest on-chain data, investors are currently facing large unrealized losses, signaling more pain for the market.
STHs suffer heavy losses due to market crash
In a Quicktake post on the CryptoQuant platform, online crypto expert Crazzyblockk says revealed those specific classes of Bitcoin investors are experiencing worrying losses. This evaluation is based on the Age-Band Unrealized PnL Distribution metric, which shows the amount of gain or loss that different classes of Bitcoin holders (sorted by age of coins held) have yet to realize.
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According to Crazzyblockk, Bitcoin’s newest investors, who have held out for between a day and a week, are facing significant unrealized losses. Meanwhile, recent lenders with slightly broader maturities (1 day to 1 month) are not exempt from the current market heat.
Additionally, short-term holders who have been involved for six months are also experiencing significant drops as the Bitcoin price is well below their cost basis.
In the Quicktake post, Crazzyblockk highlighted that when investor groups are faced with these large amounts of unrealized losses, any price recovery is a source of exit liquidity. This is because crypto investors tend to exit the market with minimal losses or at breakeven.
As a result, the classic phenomenon of ‘Support Becoming Resistance’ would continue to occur, as these investors continue to exit the market just below or at their cost.
However, the verdict on the Bitcoin price is not entirely gloomy, as the analyst explained. While the BTC market is clearly leaning towards a bearish structure, the behavior of short-term holders will play a major role in determining its direction in the coming days.
Crazyyblockk explained based on historical data that if short-term investors avoid capitulating at around 20 – 30% unrealized losses, the flagship cryptocurrency could avoid the deep reset that comes with a full-blown bear market.
On the other hand, a series of capitulation events among this investor cohort could trigger a deep extension of Bitcoin’s crash as these exits add more momentum to the already existing bearish pressure. And until this investor group is completely wiped out of the market, Bitcoin’s price could continue its current decline.
Bitcoin price at a glance
At the time of writing, Bitcoin is valued at around $84,530, reflecting a 4% decline in the past 24 hours. According to data from CoinGecko, the leading cryptocurrency has fallen more than 11% in the past week.
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Featured image from iStock, chart from TradingView