Quick Takeaways:
- Bitcoin realized losses have jumped to their highest levels since the 2022 FTX crash.
- Short-term holders are driving the ongoing capitulation, according to Glassnode and CryptoQuant.
- Analysts warn the bottom may not be in yet as fear metrics hit extreme levels.
BTC Slides as Losses Spike to Historic Levels
Bitcoin is confronting one of its most severe drawdowns since the 2022 FTX crash. The terms have fallen back to the April point near $83 000, triggering a wave of sell pressure across the market.
Data from Glassnode shows that realized losses have surged to levels unseen since the FTX implosion. The firm said the scale and speed of losses reflect a major washout of recent buyers exiting during the drawdown.
Minutes after Glassnode’s update, Bitcoin touched $80,500 on Coinbase. The drop marks a steep 36% decline from its $126,210 all-time high set in early October.
Short-Term Holders Lead the Capitulation
Glassnode’s latest data suggests that short-term holders are driving the current sell-off. These newer market participants often react quickly to sharp downside moves.
CryptoQuant echoed the same trend. The firm noted that short-term selling can mark a local bottom if Bitcoin reclaims the cost basis. If not, history shows a deeper bearish phase can follow.
Despite growing fear, some industry voices remain unconvinced that a full bear market has arrived. Samson Mow of Jan3 said the market never experienced a “proper bull run” and questioned whether a crypto winter has begun.
Extreme Fear Raises the Stakes
Bitcoin has now logged four consecutive weeks in the red. The Crypto Fear & Greed Index has plunged into “Extreme Fear,” signaling heightened panic among retail investors.
Mati Greenspan, CEO of Quantum Economics, said Bitcoin has been sliced through support levels “like butter. ” He warns that bears might reach their quarry sooner than have a bun in the oven if the current impulse continues.
The downswing echoes the disorderly months surrounding the Terra and FTX collapses in 2022. Bitcoin precipitates from $33 000 to under $16 000 as liquidity concerns spread across the industry.
Will the Market Bottom Soon?
Bitcoin bottomed near $15,700 after the FTX collapse and tarried below $20 000 for nearly two months before recovering in 2023. Some analysts think a similar pattern could play out now.
Fundstrat’s Tom Lee expects Bitcoin to rebound strongly once the market stabilizes. He has predicted a sharp recovery toward $150,000–$200,000 by January 2026.
For now, the market waits for signals of renewed demand. Until BTC reclaims key support levels, uncertainty around the tooshie is likely to persist.