The flagship currency, Bitcoin slumped 11% during the early Asian trading hours to hit $34,900; the lowest level in a month. Similarly, major Altcoins including Ethereum, XRP, and Solana logged double-digit losses, wiping out nearly $200 billion in crypto market capitalization.
Bitcoin Price Analysis
BTC started a strong decline and broke many supports near $37,500. The Downtrend took the bitcoin price below the $35,000 level. However, the bears are showing no signs of resting, increasing the risk of a move towards $33,500.
Overall, considering the present situation, Bitcoin (BTC) will likely continue moving sideways unless there’s some positive outcome of the recent turn of events between Russia and Ukraine.
Are Bitcoin’s being held at loss?
According to blockchain statistics, the leading cryptocurrency may be in a long-term bear market, with over 4.7 million Bitcoins being held at a loss. A number of gloomy indicators suggest that the bellwether cryptocurrency may continue to fall. Glassnode, a blockchain analytics firm, recently reported a decline in Bitcoin interest and demand. Around 219,000 BTC wallets have been emptied in the last month.
The recent spending behavior, according to Glassnode, could be due to the financial cost and psychological pain of holding an underwater investment. The percentage of on-chain entities that are profitable ranges from 65.78 percent to 76.70 percent of the network, implying that more than a quarter of all network entities are in the red.
As per the analysis, the recent drop in Bitcoin price could be linked to broader market concern regarding the Federal Reserve’s expected interest rate hikes and the situation in Ukraine.
Further, according to Glassnode, Bitcoin’s price may continue to decrease since long-term investors are underwater in their positions. As a result, BTC will fall further into unrealized loss, and those coins kept will be spent and sold more frequently.
On-chain experts are primarily concerned with supply dynamics. However, there is no denying that there is a demand-side to the price discovery equation. Most long-term holders have maintained their strong, HODL-conviction and have accumulated more over the last year, particularly after the $64K ATH in March 2021.