Since its inception, Bitcoin, the preeminent cryptocurrency, has witnessed several market cycles, each with its highs and lows. Its volatile nature has recently tested investors\u2019 mettle, especially those who ventured into Bitcoin in the past three months. <\/p>\n
New findings<\/a> from analytics firm Glassnode have painted a detailed picture of the current scenario, revealing the challenges faced by short-term holders (STHs) of the premier cryptocurrency.<\/p>\n STHs, defined by Glassnode as entities holding Bitcoin for 155 days or less, have recently felt the heat. The firm\u2019s research disclosed that roughly 97.5% of these investors<\/a> grapple with unrealized losses. <\/p>\n To put it in perspective, as of September 17, Glassnode reveals<\/a> the cost basis (or average purchase price) for those refraining from selling their BTC stands at $28,000, precariously hovering around 5% above the prevailing market rate.<\/p>\n This situation stresses those new to the crypto ecosystem,<\/a> causing many to reconsider their potential investment strategies.<\/p>\n Delving deeper, Glassnode\u2019s \u201cThe Week On-Chain\u201d report highlights a marked change in sentiment among Bitcoin\u2019s short-term holders. The firm identified a distinction between STHs based on their activity \u2013 those who spend their Bitcoin and those who hold. <\/p>\n An interesting trend emerged from this classification<\/a>. The cost basis of the spenders dipped below that of the holders during the market\u2019s descent from $29,000 to $26,000 in mid-August. This shift indicates a sentiment of concern and pessimism among the STH community.<\/p>\n Glassnode introduced a \u2018trend confidence metric to quantify this sentiment further.\u2019 This metric is derived by deducting the spender\u2019s cost from the holder\u2019s cost basis and dividing the resultant value<\/a> by Bitcoin\u2019s current price.<\/p>\n A pivotal takeaway from this metric was the evident negative shift in market sentiment. As stated in Glassnode\u2019s conclusion:<\/p>\n The Bitcoin market is experiencing a non-trivial shift in sentiment, with almost all Short-Term Holders now underwater on their supply.<\/p>\n The firm noted that the current atmosphere of unease has been \u201cunparalleled\u201d since the FTX debacle. Glassnode noted:<\/p>\n This has resulted in a negative shift in sentiment, with investors spending now having a lower cost basis than the rest of the cohort. This suggests a degree of panic is dominating this group, which is the first time since FTX collapsed.<\/p>\n Meanwhile, although Bitcoin\u2019s short-term holders are grappling with steep losses, the asset experienced a slight uptick yesterday, pushing its price above $27,000. However, this gain was short-lived as Bitcoin quickly retraced its steps, trading at $26,605 at the time of writing, with a 2.1% decline<\/a> in the last 24 hours.<\/p>\n Featured image from iStock, Chart from TradingView<\/p>","protected":false},"excerpt":{"rendered":" <\/p>\n Since its inception, Bitcoin, the preeminent cryptocurrency, has witnessed several market cycles, each with its highs and lows. Its volatile nature has recently tested investors\u2019 mettle, especially those who ventured into Bitcoin in the past three months. <\/p>\n New findings<\/a> from analytics firm Glassnode have painted a detailed picture of the current scenario, revealing the challenges faced by short-term holders (STHs) of the premier cryptocurrency.<\/p>\n STHs, defined by Glassnode as entities holding Bitcoin for 155 days or less, have recently felt the heat. The firm\u2019s research disclosed that roughly 97.5% of these investors<\/a> grapple with unrealized losses. <\/p>\n To put it in perspective, as of September 17, Glassnode reveals<\/a> the cost basis (or average purchase price) for those refraining from selling their BTC stands at $28,000, precariously hovering around 5% above the prevailing market rate.<\/p>\n This situation stresses those new to the crypto ecosystem,<\/a> causing many to reconsider their potential investment strategies.<\/p>\n Delving deeper, Glassnode\u2019s \u201cThe Week On-Chain\u201d report highlights a marked change in sentiment among Bitcoin\u2019s short-term holders. The firm identified a distinction between STHs based on their activity \u2013 those who spend their Bitcoin and those who hold. <\/p>\n An interesting trend emerged from this classification<\/a>. The cost basis of the spenders dipped below that of the holders during the market\u2019s descent from $29,000 to $26,000 in mid-August. This shift indicates a sentiment of concern and pessimism among the STH community.<\/p>\n Glassnode introduced a \u2018trend confidence metric to quantify this sentiment further.\u2019 This metric is derived by deducting the spender\u2019s cost from the holder\u2019s cost basis and dividing the resultant value<\/a> by Bitcoin\u2019s current price.<\/p>\n A pivotal takeaway from this metric was the evident negative shift in market sentiment. As stated in Glassnode\u2019s conclusion:<\/p>\n The Bitcoin market is experiencing a non-trivial shift in sentiment, with almost all Short-Term Holders now underwater on their supply.<\/p>\n The firm noted that the current atmosphere of unease has been \u201cunparalleled\u201d since the FTX debacle. Glassnode noted:<\/p>\n This has resulted in a negative shift in sentiment, with investors spending now having a lower cost basis than the rest of the cohort. This suggests a degree of panic is dominating this group, which is the first time since FTX collapsed.<\/p>\n Meanwhile, although Bitcoin\u2019s short-term holders are grappling with steep losses, the asset experienced a slight uptick yesterday, pushing its price above $27,000. However, this gain was short-lived as Bitcoin quickly retraced its steps, trading at $26,605 at the time of writing, with a 2.1% decline<\/a> in the last 24 hours.<\/p>\n Featured image from iStock, Chart from TradingView<\/p>\n <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"colormag_page_layout":"default_layout","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[82],"tags":[],"class_list":["post-29973","post","type-post","status-publish","format-standard","hentry","category-blockchain"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts\/29973","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/comments?post=29973"}],"version-history":[{"count":0,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/posts\/29973\/revisions"}],"wp:attachment":[{"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/media?parent=29973"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/categories?post=29973"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cryptocornercafe.com\/cafe\/wp-json\/wp\/v2\/tags?post=29973"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Shift In Sentiment And Trend Confidence Metric<\/h2>\n
Bitcoin Short-Term Holders\u2019 Cost Basis Troubles<\/h2>\n
Shift In Sentiment And Trend Confidence Metric<\/h2>\n