Bitcoin is facing intense selling pressure as short-term holders offload their assets at a loss, triggering a market decline reminiscent of the August 2024 crash, according to analysts at Glassnode.
Short-Term Holders Drive Selling Pressure
In a March 11 research report, Glassnode highlighted that Bitcoin’s recent price decline is being fueled by short-term holders capitulating amid fading demand. Since January, accumulation trends have remained weak, signaling that buyers are not stepping in to absorb the sell-off.
The downturn has coincided with Bitcoin’s price drop from $108,000 to $93,000, raising concerns about diminishing market confidence. External factors such as the Bybit cyberattack and increasing U.S. tariff tensions have further added to investor uncertainty.
Weak Buy-Side Support Signals Risk Aversion
According to Glassnode, the absence of significant dip-buying this time around suggests that sentiment has shifted toward risk aversion and capital preservation instead of continued accumulation. Unlike previous downturns where large buyers stepped in to stabilize prices, the current market conditions indicate a more cautious approach among investors.
Short-term holders, in particular, have been hit the hardest as Bitcoin’s price declines. Data shows that after falling below $95,000, many recent buyers started selling at a loss. The short-term holder spent output profit ratio (SOPR), which tracks whether short-term holders are selling at a profit or loss, hit 0.97 when Bitcoin briefly crashed to $78,000—highlighting the extent of panic selling.
Metrics Confirm Panic-Driven Selling
Another key indicator, short-term holder coin days destroyed, further confirms the severity of the sell-off. This metric, which measures the intensity of spent Bitcoin held by short-term holders, dropped to -12.8K coin days per hour. Glassnode noted that this reflects a high level of loss realization and suggests a moderate capitulation event.
“This pattern is similar to what we observed in August 2024 when Bitcoin fell to $49,000 due to macroeconomic stress and market uncertainty,” the report stated.
Potential Market Consolidation Ahead
With Bitcoin now trading near critical cost-basis levels, analysts suggest that the market may enter a consolidation phase before finding solid support. While selling pressure remains dominant, a stabilization period could emerge once risk appetite returns and long-term investors step in.
For now, traders remain cautious as Bitcoin struggles to regain bullish momentum. The coming weeks will be crucial in determining whether Bitcoin can break free from the downward trend or if further capitulation is on the horizon.
