Short-term investors in trouble. Although it is less prone to volatility than other cryptocurrencies, the Bitcoin stay one volatile asset. Obviously, this volatility can scare off some investors, especially the most novice.
Bitcoin: small investors facing volatility
Data from Glassnode, the data analytics company, revealed that short-term BTC holders tended to be more sensitive to changes of the asset price.
Remember that last week, the course of the Bitcoin Suddenly Dropped 10% Within Hours. Although most Bitcoin aficionados are used to this type of movement, newcomers can quickly panic.
According to Glassnode, after this fall, 88.3% of the supply owned by “short term” wallets – Or short term holder (STH) – i.e. those who bought bitcoin less than 155 days ago had their position moved in the red.
In practice, of the 2.56 million BTC held by short-term holders, around 2.26 million were purchased at a higher price than the current market price.
“Sharp increases in the supply of losing STH tend to follow the larger markets, such as May 2021, December 2021 and again this week. Of the 2.56 million BTC held by STHs, only 300,000 BTC (11.7%) are still in profit. »
Glassnode
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When panic takes hold of the markets
Faced with this proliferation of losing positions, Glassnode has also identified a increase in transfers to trading platforms.
Indeed, the company has identified an increase in BTC flows from STHs to exchanges. This suggests that many of these holders are considering reselling their BTC, even if it means incurring losses.
“This week we saw the strongest loss dominance since the March selloff at $19,800. This suggests that the STH cohort is both largely underwater and increasingly price sensitive. »
Glassnode
This situation has potentially accentuated recent moves in BTC. Since then, the course of Bitcoin has returned to more stagnant positions.
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