Bitcoin’s long-term holder (LTH) cohort is now sitting on its deepest pile of underwater coins since the March 2020 panic, a signal that the market’s cleanup phase is still grinding forward.
Bitcoin’s long-term holder (LTH) cohort is now sitting on its deepest pile of underwater coins since the March 2020 panic, a signal that the market’s cleanup phase is still grinding forward. According to the on-chain update from Glassnode, LTH entities currently hold 5.3 million BTC at an unrealized loss. That reading eclipses the post-FTX crash tally and now rivals only the extreme stress seen when the pandemic first shattered global markets.
The scale of the stress is magnified by who is taking the pain. Long-term holders are the cohort least likely to panic, typically accumulating through bear phases and distributing into strength. When this group begins to bleed on paper at historic levels, it means price has bitten deep enough to hurt even the most committed hands. The composition of that underwater supply matters too—many of these coins were accumulated by cycle-top buyers who held through the drawdown but are now choosing to exit. Their selling is being picked up in realized loss data, which shot to $1.3 billion per day as Bitcoin slipped back toward $62,000. LTHs accounted for $770 million of that tally, roughly 59% of total realized losses.
To find a worse reading, you have to go back to the Covid crash, when Bitcoin’s price collapsed from $8,000 to $3,800 in a matter of days. The fact that we’re now back at those depths—against a price almost 16 times higher—reveals how aggressively the market has punished late-cycle entrants. The post-FTX episode, which saw LTH supply in loss spike around the exchange’s implosion, was already considered an outlier. That level has now been breached, suggesting the resolution process is not a fleeting shakeout but an extended recalibration of cost bases.
The sheer volume of 5.3 million BTC stuck underwater also raises questions about how much farther this purge needs to run. In previous cycles, LTH supply in loss started to decline only after price found a durable floor and fresh accumulation took over. Right now, the data points the other way. The market has not yet seen a convincing reduction in LTH pain; instead, it’s ticking higher. That doesn’t guarantee another leg down, but it does make the recovery path look longer and more fragile. Any macro or regulatory shock—like the political heat around the crypto bill that banks are attempting to kill just days before a Senate vote—could turn hesitant selling into outright capitulation.
The realized loss spike is not just a big number; it’s a structural shift. When daily aggregated losses hit $1.3 billion, the market is no longer in a smooth pullback. It is repricing risk in real time, and LTHs are leading the charge to the exit. The fact that 59% of that volume came from long-standing wallets tells you that the hold-through mentality is cracking. Some of these entities held through the post-FTX drop and the choppy months that followed, only to finally capitulate at levels they likely considered safe a year ago.
That mismatch—between where coins were accumulated and where they are being given up—is what makes the current setup unusually heavy. Bitcoin’s price is not at historic lows, but the concentration of underwater LTH supply is. Traders watching on-chain data will be monitoring whether the realized loss rate begins to ease or accelerates further. A deceleration would suggest that the forced selling is burning out, potentially setting the stage for a supply-side-driven stabilization. Acceleration, on the other hand, would confirm that the resolution process still has room to run. While the on-chain picture is undeniably stressed, broader ecosystem activity continues to hum, with developer traction across major chains holding up as shown in our recent top 10 blockchains by developer activity report. That contrast between on-chain coin stress and ongoing builder activity is one of the defining tensions of this cycle.
