Over the past week, bitcoin investors decided to sell their coins with the biggest loss in history. BeInCrypto takes a look at on-chain indicators, according to which bitcoin has lost $19.121 billion in the past 6 days.
The selling avalanche was first triggered by a loss of support at the $28,000 area, which occurred on June 12 (blue arrow). A day later, a huge red candle, whose body was over -15%, was printed.
This was followed by an unprecedented drop for bitcoin below the previous cycle peak of 2016-2017 to $20,000 on June 18 (orange arrow).
BTC Chart by Tradingview
This dynamic downward movement occurred in a relatively high degree. This indicates that many coins in this category have changed hands. Moreover, the move occurred in the $28,000-$32,000 range after a 33-day consolidation. This area will now probably act as resistance.
Realized loss new ATH . reaches to
Actual Loss is an indicator that represents the total loss (expressed in USD) of all transferred coins that had a price higher than their current move price in the last move.
The June 13-18 price action described above drove the real loss ratio to a record high. The total loss that investors suffered when deciding to sell their coins purchased at higher prices for the previous 6-day period (blue area) amounted to $19.121 billion.
These are the magnitude of losses, measured in USD, that bitcoin investors and traders have never experienced in history. This can be best seen on the longer term chart, where the actual loss is represented by its 7-day moving average.
Just a month ago, BeInCrypto analyzed the same on-chain indicator, suggesting that the actual losses in May may have signaled an imminent bottom in the bitcoin price (green circle). The reason for this was a sharp increase in actual losses during BTC’s drop from $38,000 to $29,000. At that point, the indicator is approaching its previous ATH, which was established during a similar decline in May 2021 (blue circle).
However, the actual losses we are seeing today are at a much higher level than all previous investor loss peaks (red line). The 7-day moving average of the indicator is today at its all-time high of $2.831 billion.
Also, it is worth remembering that historically extremely high real loss readings were indicative of a local or macro bottom (orange arrow). Therefore, they were usually followed by strong surges.
We have already lost more BTC
A complimentary look at the Realized Loss indicator is provided by expressing its size in BTC, not USD. In this case, it turns out that there were times when investors decided to sell their assets at a greater loss against their value in bitcoin at the time.
on-chain analyst @SwellCycle Tweeted a chart of actual losses expressed in BTC in 2015. On the chart, he highlights areas of extremely high losses (yellow) made by investors. It turns out that the most severe drop, which occurred on June 13, was only the third largest in the history of bitcoin.
The big real losses were related to bitcoin’s December 2018 bottom, which it reached at the end of the last bear market. In contrast, a large real loss occurred during the COVID-19 crash in March 2020, the largest ever measured in BTC. In addition, there was a real loss compared to the current levels during the bear market low in January 2015.
Net realized profit/loss reaches ATL
There is another indicator worth noting which also shows that today’s actual losses are at their all-time high. The net realized profit/loss ratio of all the transferred coins is calculated by the difference between the actual profit and the actual loss.
Here again, in the longer term outlook, we see that the net realized profit/loss has never been reduced. Currently, the chart is reaching an all-time low (ATL) of $2.199 billion. However, note that this ratio again expresses the actual loss in USD.
For the latest bitcoin (BTC) analysis from BeInCrypto, click here,
