Benign Cycle or Capitulation Awaits Bitcoin?

Bitcoin investors are finally facing losses on an annual basis, but they remain below previous cycle lows. According to Julio Moreno, head of research at CryptoQuant, a one-year rolling total had fallen to a net realized loss of 136,000 BTC, with a value of $62,630.00.

This figure is far below the losses seen during previous downturns, when annual realized losses reached 1.3 million BTC and 3.7 million BTC.

Moreno argues that this suggests 'capitulation', or widespread selling by investors at a loss, 'is nowhere to be seen.'

In fact, he believes either this is the most benign cycle in terms of realized losses or there's still a lot of room to go. Realized losses occur when Bitcoin moves at a lower price than when it previously changed hands.

Moreno also cautions against treating a decline in Bitcoin’s realized capitalization as direct evidence that investors are selling at a loss, pointing out that ETFs have been net sellers this bear market and institutional investment may not be enough to mitigate the problem.