The quantity of Bitcoin the losing supply has reached a key bear market threshold, surpassing 10 million BTC, or more than half of the total in circulation.
According to Glassnode data, with a one-hour resolution, the number peaked at around 10.5 million BTC as the price fell to $61,300 on Thursday. The total circulating supply is around 20 million BTC, so more than half of all coins are currently held at an unrealized loss.
At the same time, the profitable supply decreased to around 9.8 million BTC. This is the first time in the current market cycle that the amount of Bitcoin held at a loss has exceeded the amount held at a profit.
Historically, this transition has only occurred during deep bear market conditions and has often coincided with major market lows.
Previous cycles provide some context.
During the 2015 bear market, supply-loss and supply-profit remained near equilibrium for almost a year before the market recovered. In 2019, the period lasted approximately six months. The Covid-induced capitulation in March 2020 was shorter, lasting about a month, and the 2022 bear market saw this persist for about six months.
The takeaway is that while this signal has historically aligned with bear market lows, the length of these periods has varied significantly, making it difficult to estimate how long Bitcoin could remain at depressed levels.
Adding to the significance of the recent decline, Bitcoin touched its 200-week moving average of around $61,300. The metric is a long-term trend indicator that calculates the average price of Bitcoin over the previous 200 weeks. It has historically acted as a major support level during every bear market cycle.
If bitcoin falls below the psychologically important $60,000 level, the next major support zone is around $54,000, which is the realized price. The realized price represents the average acquisition cost of all bitcoins in circulation, based on the price at which each coin was last moved on-chain. Bitcoin has traded below its realized price during every major bear market.
