Bitcoin Realized Loss Nears $900 Million, Highest Since FTX Crash

Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and publishing How Our News is Made Strict editorial policy that focuses on accuracy, relevance, and impartiality Ad discliamer Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio. On-chain data shows the Bitcoin Realized Loss has spiked to its highest level since November 2022 as investors have capitulated after the price crash. Bitcoin Realized Loss Has Hit A Value Of $889 Million In a new post on X, on-chain analytics firm Glassnode has talked about the latest trend in the Bitcoin Realized Loss . This indicator measures, as its name suggests, the total amount of loss that investors on the network are ‘realizing’ with their transactions. Related Reading XRP Social Sentiment Still Bullish While Bitcoin Mood Sours 16 hours ago This metric works by going through the transaction history of each coin being sold to see at what price it changed hands before this. If the previous selling price was greater than the latest spot price for any token, then its sale is considered to be resulting in some loss realization. The exact degree of loss involved in the transaction is equal to the difference between the two prices. The Realized Loss sums up this value for all loss transfers to find the total for the network. A counterpart indicator called the Realized Profit deals with the transactions of the opposite type (that is, those with a cost basis lower than the latest selling value). Now, here is the chart shared by Glassnode that shows the trend in the 7-day moving average (MA) of the Bitcoin Realized Loss over the last few years: The value of the metric seems to have shot up in recent days | Source: Glassnode on X As displayed in the above graph, the Bitcoin Realized Loss has witnessed a sharp spike recently, implying investors have participated in a notable amount of loss-taking. Something to note is that the version of the metric used by the analytics firm here is the “entity-adjusted” one, meaning that it only tracks transactions occurring between two different entities, rather than just two addresses. Glassnode defines an “entity” to be a cluster of addresses that it has determined to belong to the same owner. In the context of the Realized Loss, the entity-adjusted indicator filters out transactions occurring between the wallets of the same investor. These naturally never involve a true realization of loss (or profit), so removing them from the data provides a more accurate representation of the market. Applying for this filtration, the 7-day MA Realized Loss hit a peak value of $889 million on Wednesday. This is the highest single-day spike in the metric since November 2022, when the market crashed to the bear market bottom following the collapse of cryptocurrency exchange FTX . Related Reading Social Media Now Talking Sub-$60,000 Bitcoin Prices As Fear Rises 1 day ago The latest investor capitulation has arrived as Bitcoin has been in freefall, with its price now breaking below the $70,000 level. It now remains to be seen whether the loss-taking will sustain or if investor panic will subside in the coming days. BTC Price Bitcoin has taken a blow of more than 21% over the past week that has taken its price to the $66,700 level. The trend in the price of the coin over the last five days | Source: BTCUSDT on TradingView Featured image from Dall-E, chart from TradingView.com