Almost half of all bitcoin in circulation is now worth less than it was bought for, according to data from the Bitcoin Impact Index, which jumped sharply last week as stress returned across all segments of the market.
The index, which measures financial stress for bitcoin user cohorts based on onchain behavior, ETF and derivatives activity and cash flows, rose 13 points to 57.4 during the week ended March 28, its steepest rise since January, CEX.IO noted in a recent report.
This level, from a range up to 100, lands it right in what is seen as the “high impact” zone that historically signals the kind of broad sell-off that led to double-digit price declines in 2018, 2022 and earlier this year.
Long-term holders, wallets that have held BTC for more than six months, sold at a profit just a week ago when the cryptocurrency traded above $70,000. Now, over 4.6 million BTC from these wallets, or about 30% of their total holdings, are underwater, the report notes. Their realized losses last week were the worst since 2023.
“This kind of divergence between price action and chain conviction has historically been a warning sign,” the firm wrote. “For example, similar moves occurred in mid-2018 and mid-2022 before the price fell by over 25%.”
Short-term holders are no better off. The report found that 47% of total bitcoin supply is currently held at a loss, levels not seen since the market’s most stressed stretch in February.
At the same time, the capital flows that had supported the market earlier this month have withdrawn. Daily stablecoin net flows, which had an average inflow of $250 million, turned to outflows of $292 million. ETFs and miners also moved from accumulation to selling, the firm wrote.
So far, one key support remains intact: Onchain data shows that holders are not rushing to deposit BTC into exchanges en masse, a behavior often seen in full capitulations.
