The biggest cryptocurrency in the world saw one of its worst price performances in a single month in June. And It has been a better month as well. Many characteristics of the present market structure are those of the latter stages of a bear market. Bitcoin has yet to generate a “resilient” bottom formation signal that can eventually end the trend of corrections, even though many of these signals have already developed.
Glassnode saw a transfer of money among the stakeholders throughout the prolonged market decline. In other words, as a result of the increasing surrender from ordinary investors and miners, Bitcoin wealth is presently being moved from weak hands to strong hands. This may have suggested that a much-needed bottom is not far away.
However, miners and long-term holders (LTHs) have been put under a great deal of stress as a result of the price dropping below the $30k mark. The percentage of supply held by this group of holders rose to about 34%, according to a recent analysis by the blockchain analytics company, while short-term holders’ (STHs’) ownership fell to just 3% to 4% of the total supply.
The LTHs are always the ones that bear the brunt of significant unrealized losses. A little over 16 percent of the supply is now held by short-term holders in the loss. According to this, newly dispersed coins now need to go through “the process of maturing in the hands of higher conviction holders.”
This shows that even if there are many bottom formation indications in place, the market still needs some duration and time suffering to build a strong bottom.
Miners, whose earnings are cyclical, become a major source of selling pressure during the late stages of a bear market. With earnings that are just 49% higher than the 12-month average, bitcoin miners are already under financial strain.
Glassnode saw a total payout from the miners’ treasury of 7.9k BTC over two months as a result of their financial strain. However, it’s also crucial to remember that recently, miners have reduced their expenditure and are now distributing at a pace of 1.35k BTC/month from their held treasuries.
The most recent data indicates that miners collectively retain 66.9k BTC in their treasuries. The danger of further distribution increases if there is no discernible increase in pricing.