According to the latest data released by Glassnode, the current Bitcoin bear cycle is the worst in history. According to Glassnode, most Bitcoin (BTC) investors are at a loss. However, investors continue to sell at a loss.
As we have reported on cryptokoin.com, in addition to all the happenings, several factors contributed to making the current crypto bear market the worst ever recorded.
The biggest Bitcoin winter in history!
Blockchain analytics firm Glassnode released a report on Saturday titled “Bear with Historical Rates.” According to the report, with Bitcoin’s current decline below the 200-day moving average (MA), negative divergence from price and net losses make 2022 the worst in Bitcoin history. The first and most obvious indicator of a bear market is the Bitcoin (BTC) spot price falling below the 200-day MA. Also, an even worse scenario is shown to drop below the 200-week MA. To highlight how rare the current price levels are, Glassnode has released the report showing that during the 2022 bear market, Bitcoin dropped below half of its 200-day MA.
It was a first in history. The 2021-22 cycle recorded a lower MM value (0.487) than the previous cycle’s low (0.511). This is our first time in history.
The Mayer Multiple has reached a very rare level!
Glassnode noted that the Mayer Multiple dropping below 0.5 is a rare occurrence that hasn’t happened since 2015. MM influences price changes above and below the 200-day MA to indicate overbought or oversold conditions. Also, according to the report, “only 84 out of 4160 trading days recorded a closing MM value below 0.5. There are points that show the seriousness of the current market conditions. One of the big problems is the price ranges. It is the spot price that falls below the buying zones and forces investors to increasingly sell at a loss. Moreover, Glassnode noted that such cascading effect is typical of bear markets and market capitulations.
Glassnode notes that cases where spot prices are trading below the current price are rare. It is stated that this has happened only for the third time in the last six years. It has also occurred five times in total since Bitcoin’s launch in 2009.
Spot prices are traded at a discount of 11.3% compared to the current price. This indicates that the average market participant is currently at a loss.
Most of the investors are at a loss!
The conditions that happen are worsened by investors locking in their losses in Bitcoin. Glassnode made a statement when Bitcoin fell below $20,000 in June 2022. In the statement, it was stated that BTC investors kept the biggest daily loss in USD in history locked.
Investors collectively lost $4.234 billion in a single day. It also equates to a 22.5% increase from the record $3.457 billion set in mid-2021.
Taking all negative metrics into account, Glassnode considers the market to be in the middle of a capitulation event. Recent reports confirmed this assessment, pointing out that on Friday miners started selling their stocks. This is another indication that capitulation has taken place. Such events often serve to determine the lowest price range of a cycle.
