- Bitcoin price has plunged 55% from its November 2021 peak and 40% of BTC holders are currently underwater, based on data from Glassnode.
- The number of Bitcoin wallets falling in unrealized losses increased to 15.5% in April 2022.
- Analysts have called a bottom of $29,000 for Bitcoin price and predict a recovery within three months.
Bitcoin price recently plummeted after witnessing massive volatility and a bloodbath in the crypto market. There is a rise in the number of Bitcoin wallets that suffered unrealized losses and addresses underwater.
40% Bitcoin holders are underwater after recent price drop
Bitcoin price dropped 55% from its peak in November 2021. The drop in Bitcoin price has pushed several wallet addresses underwater. Underwater is a term used to describe addresses that hold assets that were purchased above the current price.
Based on data from Glassnode, 40% of Bitcoin holders are currently underwater, after the Bitcoin price slipped to $30,000. The asset has hit its lowest level in a year, and experts believe the risk-off approach of investors could trigger a further Bitcoin price drop.
Glassnode noted a massive influx of “urgent transactions” in the ongoing BTC sell-off, where investors have paid premiums to expedite transaction times. The total fees paid for on-chain transactions hit their highest point yet, at 3.07 BTC.
Analysts believe the dominance of on-chain transaction fees and the rising exchange deposits signal a growing sense of urgency amongst investors. $3.15 billion in Bitcoin has flown in and out of exchanges over the past week, hitting a new all-time high since the November 2021 peak.
A higher number of addresses underwater combined with urgency to sell and BTC inflow to exchanges implies a rise in selling pressure and downward squeeze on price.
Whale wallets with a balance of over 10,000 Bitcoins have witnessed a particular rise in the distribution of their BTC across the network. Retail investors with less than 1 BTC have emerged as the strongest holders, close to levels observed in February 2022.
Analysts at Fundstrat Global Advisors evaluated the Bitcoin price trend and called a bottom of around $29,000. Analysts believe Bitcoin price could witness a trend reversal within the next three months.
@crypto_noble, a crypto analyst and host of The Market Update, believes Bitcoin price could resume its uptrend if price crosses resistance at $32,500. However, failure to break past resistance could push BTC to $28,000.
$BTC #Gann— Notorious Bill (@crypto_noble) May 11, 2022
5/11, 10am EST - $BTC hit Gann price-time point of 29.6k and $BTC did not crash first time down. So that’s at least some good news.
32.5k is a resistance point. If BTC gets above that, it could be over. If $BTC does not go above that, risk is a move to 28k #bitcoin pic.twitter.com/5gxcK2ipT1
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.