Although bitcoin is down by almost 80% from its ATH, some analysts believe there might still be trouble for the asset.
CryptoQuant analysts informed that a lot of bitcoin investors have been selling at a loss recently since the asset’s price is a long way from its highest levels from a year ago.
However, the percentage of investors dumping their possessions now might not be enough to mark a bear market bottom.
- Citing the aSOPR (adjusted SOPR), which operates similarly to the standard SOPR but excludes all BTC transactions with a lifespan younger than one year, CryptoQuant’s analysis suggested that many investors are selling their bitcoin holdings at a loss now.
- As such, this could provide a good narrative that the primary cryptocurrency had finally bottomed following the massive price decline experienced in the past year.
- However, the strategist warned that the situation is not that simple, at least according to another metric – UTXO.
- The unspent transaction output (UTXO) is the amount of the underlying cryptocurrency (in this case, BTC) that is left after a transaction. CryptoQuant asserted that 70% of the UTXO is still profitable, but it was way below 50% during the past few bear markets.
“Most of the people who are selling at a loss now are relatively recent participants. The real bottom comes when more than half of investors in the entire cycle, including this, lose money.” – reads the analysis.
- Trading at $16,500 now means that bitcoin is down by around 75% since its all-time high charted last November. However, another popular crypto analyst recently warned that the asset could further drop to as low as $9,500 if it’s to mimic the previous bear markets and, indeed, find a bottom.