Losses of bitcoin holders renew highs

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The volume of losses recorded by cryptocurrency investors over the past week exceeds all previous surrenders, including March 2020, November 2018 and the sell-off that marked the end of the previous bull cycle in January-February of the same year.

According to Glassnode estimates based on the spending of coins on the Bitcoin blockchain, the amount of losses on May 19 reached a new high of $ 4.53 billion, which is more than 300% higher than the previous peaks in March 2020 and February / April 2021. The cumulative loss for the week was $ 14. 2 billion

Even taking into account the profitably sold coins at a net loss, the last surrender significantly exceeds the previous ones. Glassnode estimates the net loss of investors for May 19 at $ 2.56 billion, which is 185% more than the figure recorded during the collapse in March 2020.

Analysts also note that these losses led to a decrease in the realized capitalization of bitcoin, which is calculated based on the value of the coins at the time of their last movement. Over the week, realized capitalization decreased by $ 7 billion from an absolute maximum of $ 377 billion.

The share of wallets in which investments remain profitable has dropped to 76% with recent events, while 24% are holding unprofitable positions. Similarly, the indicator fell during the growth phases in 2011, 2013 and 2016.

Holders of unprofitable positions could potentially join panic sellers, notes Glassnode. In contrast, investors, whose bitcoins were credited to their wallets 1-3 years ago, tended to sell significantly less.

“The big question is how much of losing coins will join the panic selling,” analysts write. – To answer, we used the metric of relative unrealized losses, which represents the ratio of the value of losing positions to the current market capitalization. We found that about 9-9.5% of the current market capitalization ($ 700 billion) is in the form of unrealized losses, which corresponds to $ 65 billion. Despite the significance of the last surrender, relative to the size of the market, the value of losing positions at the blockchain level is small. Compare it to 44% in March 2020 or more than 114% in November 2018. ”

 

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