Source: Glassnode; Compilation: Baishui, Golden Finance

New demand inflows continue to weaken, and the sharp shrinkage of profits and losses absorbed by the market is proof of this.

The scale of profits and losses locked by investors is now similar to the later stages of the accumulation range in 2024, with prices ranging from $50,000 to $70,000.

The number of tokens lost by short-term holders hit the highest since 2018, indicating that most new investors are now in a loss-making position. However, the loss-loss dollar value held by these tokens is still consistent with the previous bull market situation.

The supply of long-term holders has begun to grow again, highlighting investors' preference for holding and accumulating supply.

At present, the demand side pressure is relatively small, and the price of Bitcoin continues to fluctuate back and forth within a newly established trading range centered at $85,000. One way to quantify demand is to assess the amount of realized profits and losses locked by investors, which provides key information for seller power in the spot market.

We can explore this phenomenon through two key concepts:

Capital inflow: New buyers buy tokens at a price higher than the seller's original cost (and thus locking in realized profits), and new capital enters the network.

Capital Destruction: Holders sell at a loss (realized losses), and new investors buy tokens at prices below the original buying price.

Ultimately, the indicator describes the premium or discount that the seller is willing to trade, and the market price that the buyer of the other party is willing to accept.

At present, since the all-time high of $109,000, total profits and losses have experienced a significant contraction, plunging from $3.4 billion to $508 million (-85%). The metric now records values ​​similar to the accumulation zone between $50,000 and $70,000 in 2024, indicating a similar demand situation.

We can also notice differences in consumption behaviors among long-term holders and short-term holders groups.

It is worth noting that all losses come from a short-term group of holders who represent the recent buyers and are therefore most likely to buy at a higher price. The recent unpredictable and turbulent market conditions are clearly a challenging environment for new investors.

In contrast, most profit-taking returns are achieved by a long-term group of holders who stay in the market for a long time and have been in a fully profitable state.

The typical characteristic of a sustainable bull market is that new capital continues to flow into the network, and capital inflow events far exceeds capital loss events.

In evaluating the difference between long-term holder profit-taking and short-term holder loss realization, we can see that this indicator has returned to the neutral zone. Long-term holders' profits are now offset by equal amounts of short-term holders' losses.

This indicates that new capital inflowsFor stagnation, demand side strength weakens, profit-taking returns slow down but still makes sense, forming resistance.

The short-term holder group is the culprit of most loss-making events in the bull market. This usually occurs during local market adjustments and during the last sell-off wave when the market turns into a long-term bearish structure. Therefore, they become the main analytical group when measuring the severity and potential depth of the market decline.

Recent downward volatility has brought difficult conditions for new investors, with short-term holders losing supply surged to 3.4 million BTC. This is the largest loss of STH supply since July 2018.

From a relative perspective, the percentage of loss supply has now exceeded its +1SD range, with more than 90% of short-term holders currently in the underwater position.

In our current bull market, this level of short-term holder losses have only occurred twice, namely during the downturn in August 2023 and during the closing of the yen arbitrage trading in August 2024.

This highlights the severity of the pressure new investors are currently facing and increases the possibility of a full-scale sell-off event in the market.

Another way to assess short-term holder stress is to evaluate the cost basis of each age subset in the population. We can think of them as a band of cost base levels from fast to slow, providing a momentum indicator:

< 24 hours: $89,900

< 1 week: $87,600

< January: $87,400

< March: $94,600

< June: $93,000

From this insight, one key conclusion can be drawn: Most short-term holders who hold for at least 1 month are in a loss state. Unrealized losses are spread throughout the entire short-term holder group, bringing huge financial pressure and pressure to investors.

In the previous section, we determined that a large number of short-term holders are now in a loss-making state. To supplement this analysis, we can also evaluate the total dollar value of unrealized losses (book losses) held by these tokens.

Using these two metrics, we can better understand the extent of financial losses suffered by buyers in the recent past and compare them on two related dimensions.

From the perspective of not realizing the loss indicator (book loss), short-term holders' losses are relatively high, which is one of the biggest losses in this cycle. However, the scale of book losses is still close to the upper limit we see during most bull markets.

This shows that while the financial pressure investors are experiencing is enormous, it has not yet reached the level considered unexpected or atypical in the bull uptrend.

Historically, the bull market peaked after most of the online wealth moved from long-term investors to new, increasingly price-sensitive speculators. These speculators end up holding most of the supply at high costs, which makes them highly sensitive to price declines.

Currently, short-term holders hold about 40% of the online wealth, peaking at 50% in early 2025. This peak is still significantly lower than in previous cycles, when new investors' wealth held peaks reached around 70%-90% near the peak of the cycle.

There are several possible explanations for this:

So far, the 2023-25 ​​cycle has experienced a longer horizontal consolidation period. This has led to the gradual redistribution of supply, and then investors have gradually adapted to the new price heights.

Bitcoin in 2025 will be better understood by retail investors and institutional investors. Therefore, long-term holders may be more likely to hold more supplies over a longer period of time, as they have formed a stronger belief.

The existence of large institutional investors, and ETFs, may have longer time frames and allocation preferences. Therefore, a larger proportion of the supply may be held for a long time.

There may be many factors that influence this dynamic, highlighting the evolution of Bitcoin investment arguments for new and old Bitcoin holders.

Times of sharp rise in Bitcoin prices are often accompanied by rising seller pressure as investors take profits. Historically, long-term holders have been the main group that takes advantage of high prices to make profits during the bull market.

In the current cycle, a unique market dynamic is forming, and the fluctuations in LTH allocation are followed by a accumulation period, thus creating a more controllable and stable market environment. So far, there are mainly two waves of allocation and accumulation:

Assigned 1: Allocated LTH -929k BTC

Assigned 1: Allocated LTH +817k BTC

Assigned 2: Allocated LTH -1.11M BTC

As of the two distribution waves, the seller's pressure has exceeded 2 million BTC. Generally speaking, such seller count is sufficient to end the previous bull market, however, subsequent re-accumulation periods have offset most of the allocation to date.

This balance between the allocation and accumulation periods may be a key factor in the orderly price structure we are experiencing, where price surges lead to intense allocation and profit-taking, but a horizontal price movement will follow as investors re-accumulate supply.

3m-6m holds token wealth to provide further evidence for the second wave of accumulation. This is a very special group because it exists on the transitional boundary between the short-term holders and the long-term holders group. It captures the coming weeks and severalSupply pools most likely to migrate to LTH status within the month.

Currently, the total holding wealth of the group is increasing significantly from March to June, indicating that tokens obtained when the market first trades to $100,000 are beginning to enter this range.

This group represents top buyers who have not yet succumbed to market conditions, highlighting investor confidence and patience. As long as the group continues to hold, this behavior can be seen as a precursor to the growth of long-term holders’ supply.

In addition, when we standardize the expenditure of this group, we can see that their spending activity has been the most depressed since the economic downturn in May 2021.

This confirms the dominance of inactive among these investors, suggesting that the motivation for HODL is still quite strong, and many are not hampered by book losses and volatile market conditions.

Other side of these observations is that the long-term holder group still retains a considerable portion of the online wealth, holding nearly 40% of the investment value.

These periods of holding and accumulating may gradually shrink the supply side, which over time may create conditions for a new wave of demand, thus establishing the next uptrend.

The Bitcoin market transaction price is within the new range of $78,000 to $88,000. The scale of on-chain profit and loss events is declining, highlighting the weak demand situation but the seller is under less pressure.

Short-term holders are currently facing considerable financial pressure, with most of their assets holding in a loss-making state relative to the original cost basis. While the losses of the STH population dominate, the long-term holder population is reentering the accumulation period and we expect their total supply to grow in the coming weeks and months.