Bitcoin short-term holders on the brink: market capitalization has crashed to October 2024 lows
The Bitcoin market is undergoing a serious test. On-chain data analysis shows that short-term holders (STH) — those who bought BTC in the last 155 days — have entered a zone of extreme stress. Their aggregate market capitalization fell to $237.7 billion on June 26, the lowest value since October 2, 2024. For comparison, the figure stood at $239.7 billion at that time. This decline means that the current market price of the coins held by these participants has dropped below their realized value. In other words, most recent buyers are now holding positions with unrealized losses.
Market Sentiment: 'Extreme Fear' Zone
The Fear & Greed Index plummeted to 12 on June 25, pushing the market into the 'extreme fear' phase. Notably, this occurred with Bitcoin's price around $59,700. However, data shows this is not the lowest index value this year. In June, it dropped to 8 points with the price around $63,000, and in February, to 6 points with the price around $69,000. The current situation is unique because such a high level of fear is recorded at a significantly lower price, highlighting the depth of capitulation specifically among short-term speculators.
Massive Dump: 50,000 BTC Sent to Exchanges at a Loss
The picture is compounded by fund flow data. Over the past 24 hours, short-term holders sent approximately 50,000 BTC to exchanges at a loss. This is the highest volume of loss-making transfers since June 4, when the figure approached 60,000 BTC. The volume on Binance is particularly telling: this exchange accounted for about 9,500 BTC of the total volume. This is a record high for loss-making deposits from STH on this platform since June 3, when over 16,000 BTC were deposited under similar conditions.
It is important to understand: transferring to an exchange does not mean an instant sale. However, it signals an intention to sell and creates significant short-term pressure. If this trend continues, we risk seeing further capitulation and a break of key support levels.
My View on the Situation
The combination of these signals — the STH market cap falling to October 2024 lows and a record inflow of loss-making coins to exchanges — suggests we are in the final phase of local capitulation. However, I would not rush to draw definitive conclusions. If Bitcoin can stabilize and hold above the $60,000 zone amid such pessimism, it would be a powerful bullish signal, indicating seller exhaustion. Otherwise, we face a deeper correction that will shake out the weakest hands. The key question now is not whether the price will fall further, but how long this phase of fear will last before large players begin aggressively accumulating positions.