Bitcoin Investors Sitting On Deep Unrealized Losses — What This Means For Price

[Ben Graham]

The price of Bitcoin has continued to struggle in the final quarter of the year, recently slipping beneath the 2025 starting point. According to the latest on-chain data, investors are currently sitting on deep unrealized losses, which suggests more pain for the market.

STHs Sit On Heavy Losses Through Market Crash

In a Quicktake post on the CryptoQuant platform, online crypto pundit Crazzyblockk revealed that specific classes of Bitcoin investors are holding through worrying amounts of losses. This evaluation is based on the Age-Band Unrealized PnL Distribution metric, which shows the amount of profit or loss different classes of Bitcoin holders (sorted by age of coins held) are yet to realize. 

According to Crazzyblockk, Bitcoin’s latest investors, who have held between a day and a week, are facing significant unrealized losses. Meanwhile, recent funders with a slightly broader maturity bracket (1-day to 1-month) are not exempt from the current market heat.

Additionally, short-term holders who have been involved for up to six months are also experiencing significant drawdowns, as the Bitcoin price stands far beneath their cost basis.

In the Quicktake post, Crazzyblockk highlighted that when investor groups face these high amounts of unrealized losses, any price recovery stands as a source of exit liquidity. This is because crypto investors tend to exit the market under minimal losses, or at breakeven.

As a result, the classic ‘Support Becoming Resistance’ phenomenon would continue to play out, as these investors keep exiting just beneath or at their cost basis.

However, the verdict is not totally grim for the Bitcoin price, as the analyst explained. While the BTC market evidently leans towards a bearish structure, short-term holder behavior will play an important role in determining its direction in the coming days. 

Crazyyblockk explained, based on historical data, that if the short-term investors avoid capitulating at roughly 20 – 30% unrealized losses, the flagship cryptocurrency could avoid the deep reset associated with a full-blown bear market.

On the flip side, a series of capitulation events among this investor cohort could cause a deep extension of Bitcoin’s crash, as these exits add more momentum to the already existing bearish pressure. And until this investor group is fully wiped out of the market, the price of Bitcoin could continue the current descent. 

Bitcoin Price At A Glance

As of this writing, Bitcoin is valued at around $84,530, reflecting a 4% decline in the past 24 hours. According to data from CoinGecko, the premier cryptocurrency is down by more than 11% in the past week.