The sharp decline of Bitcoin from its historical high of $126,000 reached in October has led to about a third of all coins in circulation currently being at a loss. This massive 'overhang' of tokens purchased at a higher price creates a risk of increased volatility in the event of a market recovery, as investors will be eager to sell the asset once they break even.
The main factors shaping the current situation are as follows:
1. Scale of the problem
· BTC in loss: 6.6 – 7.07 million BTC
· Share of total supply: ~1/3 (about 33%) · Market stress level: Highest since 2023
2. Who holds losses
· Short-term holders (STH): Have been hit the hardest. Around 2.8 million BTC are currently in loss for this group — the highest level since the FTX collapse in 2022. According to Glassnode, STH refers to those holding coins for less than 155 days, meaning almost everyone who bought Bitcoin above ~$104,000.
· Long-term holders (LTH): Continue to distribute. Since July 2025, their reserves have decreased by approximately 450,000 BTC. Experts believe these sales are often not due to negative sentiment toward the asset, but rather a desire to realize profits after years of accumulation, especially in the context of high liquidity from ETFs.
3. Key price levels (based on URPD)
· Weak support zone ($70,000–$80,000): Bitcoin has spent only around 28 trading days here. The URPD (Unrealized Profit & Loss Distribution) shows low concentration of coins in this range. This means that if the price drops into this zone, it could become more volatile, as there is little support to fall back on.
· Resistance zone (above $88,600): This is where the majority of coins purchased at a loss are concentrated. As the price rises toward these levels, selling pressure may increase from investors seeking to exit 'at break-even'.
📊 What is Supply in Loss and URPD?
· Supply in Loss (Supply in Loss): This on-chain metric calculates what portion of Bitcoin was purchased at a price higher than the current market price. It tracks each coin’s history, determining the price of its last transaction.
· UTXO Realized Price Distribution (URPD): This indicator shows the distribution of all current Bitcoin supply across prices at which these coins were last moved (purchased). High 'peaks' on the URPD chart indicate levels where many coins were bought — these are potential support or resistance zones.
📈 Market context and forecasts
Current Bitcoin correction of about 25% from the peak fits within the typical bull market range of 20-30%. Meanwhile, there is an important positive signal:
· Institutional investors are holding: Despite the price drop, assets managed by U.S. spot Bitcoin ETFs have declined by only about 3.6% (in BTC equivalent). This indicates that the current decline is mainly driven by sales from long-term holders, not mass withdrawals from ETFs.
At the same time, market volatility remains compressed, which, according to Matrixport analysts, reduces the likelihood of a significant price breakout before year-end.
Most loud 2025 forecasts (from $150,000 to $250,000) are no longer realistic. Many analysts, such as Tom Lee from Fundstrat, have adjusted their expectations toward more conservative targets around $100,000 by year-end.
💎 Conclusion: What does this mean for investors
The current situation is a classic example of market psychology. A large volume of coins in loss creates a 'resistance zone' on the path to recovery. However, historically, such stress levels often coincide with the exhaustion of sellers and the formation of a bottom for the next growth phase. Key points to watch are:
· Bitcoin's ability to hold above $88,600, overcoming selling pressure.
· Price behavior in the under-researched $70,000–$80,000 range in case of further correction.
A potential entry point may be exactly within the aforementioned range. The golden rule: the scarier it is to buy, the higher the profit. He who risks nothing, drinks no champagne.
