A popular network analyst argues that the current bear market has not yet “sent as many bitcoins (BTC) underwater” as previous bear markets.
Bitcoin analyst Willie Wu notes that reflecting how many coins are worth less than the purchase price is “one way to visualize maximum pain.”
Past cycles have bottomed out when about 60% of coins traded below their purchase price. Will that happen again? I don’t know. The structure of the current market is very different this time.
Previously, owners sold their coins in a bear market, in the red zones. In this cycle, we’re not seeing that kind of selling. Perhaps they are hedging futures, and the holders this time are hedge funds from 2020.
Wu’s chart shows that the 60 percent underwater level of bitcoin is currently hovering around $10,000.
He is far from the only analyst who admits that BTC could fall another level. Nicholas Merten said this week that another bear market phase could bring bitcoin closer to the $13,000 level.
On the evening of October 5, BTC was trading at $20,200 without significant day-to-day momentum with a weekly gain of 5.6%.