Bitcoin (BTC) traded at $66,450 on Thursday, a 47% drawdown from its all-time high of $126,000 reached in October 2025. That decline has left many BTC holders with significant unrealized losses and highlights ongoing risks for investors at current levels.
Key takeaways:
– Bitcoin’s 47% drawdown from its $126,000 peak has produced nearly $600 billion in unrealized losses.
– Apparent demand and buying from U.S. investors remain in contraction, suggesting broader market distribution.
44% of Bitcoin circulating supply now in the red
BTC/USD sits about 24% below its 2026 year open of $87,500 after closing 2025 in the red. Prolonged weakness has pushed a large portion of supply underwater. At $66,450, roughly 8.8 million BTC are held at a loss, representing $598.7 billion in unrealized losses, or more than 44% of the circulating supply, according to data from Glassnode.
Glassnode said this magnitude “structurally resembles conditions observed in Q2 2022,” noting that the 2022 bear market required roughly 3 million BTC to be redistributed before recovery. “Historically, resolving a supply overhang of this scale has required a meaningful redistribution of coins from loss-realizing holders to new buyers at lower prices.”
Mounting paper losses have eroded conviction and prompted long-term holders (LTH) to capitulate by selling below their cost basis. LTH realized loss — the aggregate dollar value of Bitcoin sold at a loss by investors who held BTC for more than 155 days — has risen to $200 million, which Glassnode called evidence of “active capitulation.” The firm added: “A meaningful cooldown toward levels below $25M per day would represent a more compelling signal of exhaustion in selling pressure, and a prerequisite for the base formation that historically precedes a sustainable bull market transition.”
BTC’s spot price also sits below the average cost basis of U.S. spot Bitcoin ETF holders, currently at $83,408, indicating that those investors are increasingly under strain. Risk-off sentiment is visible in global Bitcoin investment products, which recorded more than $194 million in net outflows for the week ending March 27.
Bitcoin apparent demand contraction persists
Apparent demand has been negative since mid-December 2025, as traders and investors remain risk-off amid price weakness. Capriole Investment’s Bitcoin Apparent Demand metric showed demand at -1,623 BTC on Thursday, signaling sellers in control.
CryptoQuant said the continued contraction in total apparent demand signals persistent “selling from retail,” and that the market remains in distribution. “The sustained demand contraction, now persisting since late November 2025, confirms that the broader market remains in distribution,” the firm wrote.
Coinbase’s Premium Index, which measures the premium between BTC/USD on Coinbase and Binance, remains negative, suggesting U.S. investors have not re-entered the market at scale. CryptoQuant noted: “The persistent negative premium indicates that US investors have not yet re-entered the market at scale. This is consistent with the demand contraction seen across on-chain metrics.”
As previously reported, Bitcoin risks new lows in the short term amid a strengthening U.S. dollar.
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