The long-term stress and pain that long-term holders have been suffering will continue as they begin to suffer losses from past bear markets. Long-term holders are dealing with their biggest losses since the 2018-19 bear market and the 2020 capitulation, and are still waiting for relief.
According to Glassnode’s ‘The Week Onion Report’ from June 6, the total loss received from long-term holders (LTH) of bitcoin (BTC) exceeded 0.0006% market cap.
Therefore these dramatic losses may continue to some extent if historical loss patterns from past bear markets are repeated. Whereas LTH losses have reached the level of 0.015% market cap, which is further widened for the next consecutive year.
Long term bitcoin holders position
Long term investors have been experiencing a bear market since last month. Glassnode reports further LTH losses unless they are actually comparable to bear markets, only then they can be similar. The report stated that:
“LTH losses on coins deposited in exchanges have now reached a magnitude comparable to previous bear markets. However, we do not yet have a duration component.”
Glassnode defines LTH as a holder who does not transfer their coins for at least 155 days. Anyone who bought BTC before December 2019 will be dependent on their investment from now on.
In the years 2019 and 2020, the price has recovered rapidly from its lows, with a capitulation event likely to occur before any significant price recovery.
Despite the disappointing price outlook, the influx of digital asset investment products has exceeded $100 million in the past week. A recent report by CoinShares states that most of the reported inflows were from the US, suggesting that European investors are still bearish. The report also highlighted a noticeable difference in exchange flows between BTC and Ethereum (ETH).
Inflows into the largest exchange BTC have netted approximately $506 million as of 2022, while ETH has net outflows of $357 million. This proves that the market sentiment for ETH is much lower than BTC at the moment.
