Crypto analytics firm Glassnode is analyzing the Bitcoin’s on-chain data inorder to ascertain the reason behind the price correction.
So, Glassnode explains better,
“Bitcoin futures markets have experienced a significant deleveraging event,…”
“with over $5.4 billion in open interest closed yesterday.”
“Total futures open interest declined from $22 billion to $16.6 billion in one day, a decline of 24.5%”
Furthermore, Glassnode goes ahead to consider entities on the Bitcoin network, taking the major hit of the dip.
More so, as per Glassnode data, Bitcoin belonging to long-term holders is relatively the same even during the correction. Of course, This shows that investors new into the market are the ones to take the whole loss.
“Question is, which cohort of Bitcoin holders were realizing these losses?”
Then, Glassnode adds,
“If we look to long-term holder supply, we can actually see their total holdings are unchanged…”
“over the past week. This makes it more probable it was recent buyers…”
“The short-term holder (STH) SOPR (spent output profit ratio) metric, on the other hand,…”
“shows very significant losses were realized by this cohort…”
“Spending by STHs was the least profitable it has been since the $29,000 lows set back in July.”
More so, Glassnode confirms the liquidation on December 4th is one the largest in Bitcoin’s history.
Then, it goes to list other capitulations,
“Bitcoin holders realized the third-largest on-chain capitulation in history….”
“over the weekend, with over $2.18 billion in realized losses.”
In comparison with
– $1.38 billion in March 2020
– $2.65 billion in May
– $3.45 billion in June.”
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