Bitcoin Historic Late-Bear
Data from Glassnode shows that Bitcoin has not yet seen a crossover in the current cycle that historically characterizes late bear periods.
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Bitcoin Realized Price in the Short Term Still Above Long Term Holder
According to the latest weekly report from glass nodethe STH and LTH realized price crossover has not yet occurred during the current bear market.
the “realized price” is a metric that indicates the cost basis of the average holder in the Bitcoin market. The value is calculated by dividing the realized cap with the total number of coins in circulation.
Whenever the usual price of BTC falls below the value of this indicator, the average investor goes into a state of loss.
This cost base can of course also be calculated specifically for different holder groups. The relevant cohorts here are the “long term holders” and the “short term holders”; Here’s a chart showing the trend in realized prices of these two groups over the past few years:
The values of the two metrics seem to be approaching each other | Source: Glassnode's The Week Onchain - Week 37, 2022
Long-term holders (LTHs) include all those Bitcoin investors who have held their coins since at least 155 days ago, while short-term holders (STHs) are those who have kept their coins quiet for less than that.
As you can see in the chart above, the realized prices (RPs) of these two cohorts have observed crossovers during the last two bear markets.
In these cycles, the LTH RP crossed above the STH RP as the late bear started. The implication of such a crossover is that recently purchased coins (in the past 155 days) are now more profitable than coins bought long ago. This shows that the market has gone through a deep capitulation.
However, during the current bear market, the crypto has yet to see such a crossover even after already observing 10 months of decline.
The post-crossover bear period lasted 339 days in 2014-15, while it was 145 days in 2018-19. This would indicate that the current bear will have a while to go before a bull market can kick in as the crossover hasn’t even happened yet.
The report notes that at the rate the two metrics are approaching each other, this cross is likely to happen this month.
At the moment of writing, The price of Bitcoin hovers around $22.5k, up 13% over the past week. Over the past month, the crypto has fallen 7% in value.
Looks like the value of the crypto has been going up during the last few days | Source: BTCUSD on TradingView
Featured image from Hans-Jurgen Mager on Unsplash.com, charts from TradingView.com, Glassnode.com