With the broader crypto market on edge, Bitcoin [BTC] is struggling to maintain upward momentum. In fact, Bitcoin has been hovering between $89,000 and $94,000 for almost a week, reflecting a market that is at a decision point.
Amid this market slowdown, unrealized losses have soared across the market.
Bitcoin’s unrealized loss was $85 billion
With BTC and the broader crypto market remaining below historical peaks for an extended period of time, losses have increased significantly.
According to glass button, Unrealized losses in the crypto ecosystem have risen to $350 billion.
This sharp increase suggests that most crypto assets are experiencing heavy selling pressure. Among them, Bitcoin stands out, with $85 billion in unrealized losses.
Source: Glassnode
This implies that most short-term bonds and some long-term bonds are now experiencing losses. Typically, larger unrealized losses pose a risk of market collapse if panic sets in, leading to a sell-off.
Whale suffers a $5 million loss!
As unrealized losses mount, some investors, especially whales, have started closing their positions.
Bitcoin has reflected this shift with a noticeable spike in stock market activity. The Fund Flow Ratio has steadily increased from 0.06 to 0.106, indicating an increase in BTC deposits on exchanges.
Source: CryptoQuant
According to Look at chaina whale deposited 2,000 BTC, worth $180.33 million, into Binance.
On December 4 and 5, this whale address received 5,000 BTC from Matrixport, worth $463.55 million for $92,710.
After the sale, Arkham records show the address still contains 3,000 BTC worth $277.61 million. As a result, the whale suffered approximately $5 million in losses from the deposition.
Source: Arkham
Now that the whale is choosing to realize losses, it indicates a loss of confidence in the market after a week as they fear further losses.
BTC at intersection, which way?
Bitcoin’s problems continued as investors, especially whales, even started selling at a loss. However, demand is showing first signs of recovery.
In fact, Exchange Netflows have remained negative for five consecutive days and have turned positive only once in the last seven days.
Source: CryptoQuant
At the time of writing, Netflow was at -2.2k, showing that withdrawals exceeded deposits, a clear signal of accumulation.
As demand recovered, BTC breached the short-term EMA20 near $91,769, marking a shift to bullish short-term momentum.
However, the broader trend remains bearish. BTC is still trading below the 50, 100 and 200 EMAs. Additionally, the Directional Movement Index fell from 20 to 17, underscoring strong longer-term bearish momentum.
Source: TradingView
Therefore, if the near-term momentum shift continues, providing buyers with a path, Bitcoin could reclaim $94,000 and target the EMA50 at $96,476.
Conversely, if the attempt fails, it will drop below the EMA20 and cross $90,000 support again.
Final thoughts
- A Bitcoin whale unloaded 2,000 BTC, worth $180.3 million, and suffered a loss of $5 million.
- Bitcoin’s unrealized losses have risen to $85 billion, while the crypto market has recorded $350 billion in unrealized losses.