Over 95% of short-term Bitcoin holders are currently underwater, according to a weekly on-chain report by Glassnode, as the cryptocurrency struggles to find meaningful demand from institutions or corporate treasuries. The data indicates that recent buyers are facing significant losses, with those who purchased in May down 17% to 19%, and the market has yet to show a bounce sufficient to return these positions to profitability.

Short-Term Holder MVRV Signals Broad Losses

Glassnode’s Short-Term Holder MVRV metric, which tracks the average profit or loss of recent buyers, printed a low of 0.81 before recovering slightly to 0.83. The accumulation cluster between $78,000 and $82,000 established during May is now broadly in loss. Currently, only 3.3% of short-term holder supply remains in profit, a sharp deviation from the four-year average of 55%.

Selling pressure is accumulating but has not yet reached the extreme levels that historically signal a market bottom. The loss realization indicator currently sits at -1.86, approaching the -2 threshold that has previously marked peak fear and preceded recoveries in past cycles.

Institutional and Corporate Demand Retreats

The Coinbase Premium has dropped into discount territory as Bitcoin fell toward $60,000, suggesting that US institutions stepped back from spot buying rather than buying the dip. Corporate treasury accumulation, which had peaked above $500 million per day in April and May, has slowed to near zero in June, removing a critical source of market support.

A major deleveraging event occurred as Bitcoin broke below the $64,000 to $70,000 support zone, liquidating a large concentration of leveraged long positions. While the leverage profile is now cleaner, this flush has not been met with fresh spot demand to replace the leveraged capital.

Options Markets Price in Further Downside

Options traders are paying significantly more for downside protection following the price breakdown. One-month implied volatility rose from 34% to 45%, and put options now represent 35.9% of all options premium traded in the last 24 hours.

The key level to watch is $65,000, where the largest concentration of dealer short gamma is located. Market makers are forced to sell Bitcoin as the price falls toward this zone, which can accelerate downward momentum. Meaningful dealer support is not expected until the price reaches the $76,000 to $82,000 range.

Two macro conditions must change before a real recovery can occur: the US dollar index must break below 99, and the 10-year Treasury yield needs to drop toward 4.2%. Currently, the dollar index sits at 100.01 and the 10-year yield is at 4.53%, leaving both conditions unmet.

Prominent crypto analyst Capo remains bullish on Bitcoin (CRYPTO: BTC), arguing that current market conditions resemble an accumulation phase rather than the start of a deeper collapse. In a June 11 market update, Capo acknowledged that his bullish thesis has not played out yet but maintained that his broader outlook remains unchanged. He noted that high-timeframe market calls often take longer to develop and that timing is frequently the most difficult part of macro investing.

Despite Bitcoin's weakness, Capo continues to view the current area as a major support zone, similar to the situation in February. He pointed to increasingly bearish sentiment as a potential contrarian indicator, noting that many traders are now expecting significantly lower prices. Capo believes capital could eventually rotate from equities into crypto after the strong stock market rally seen in recent months.

Altcoins Show Relative Strength

Another key observation is the relative resilience of altcoins. "Altcoins have been holding much better than BTC, which is a sign of strength," he said. Many altcoins remain down between 90% and 99% from their highs, often without experiencing meaningful dead-cat bounces. "This is not time to sell, but to buy," Capo suggests.

Four-Year Cycle Evolution

When asked whether the traditional four-year Bitcoin cycle is over, Capo noted the framework may still be intact but changing. If the 2026-2028 period remains largely bearish and the next major recovery does not begin until after the next halving, he views that as a distorted version of the traditional cycle. "Kind of like music: you can still have a four-beat rhythm, but every few bars the structure can shift," Capo said. He predicts that Bitcoin could remain trapped in a broader macro bearish phase that includes sharp countertrend rallies.