Are Bitcoin short-term holders responsible for current market downturn

ambcrypto.com:

Bitcoin’s [BTC] decline to the $18,500 price region marked the second-lowest low of the bear cycle. As per Glassnode‘s latest report, 11.8% of the coin’s supply has been turned into an unrealized loss. 

Furthermore, in the last week, the price per BTC rallied from the second lowest low of the current bear market ($18,649) to peak at $21,758. Prices, however, remained within the consolidation range, which Glassnode noted has been so intact for over three months. 

BTC’s price touched the lower ends of the consolidation range in the last week. Glassnode considered the volume of coins held at an unrealized profit at the high of $24,500, which turned into an unrealized loss. 

A look at the Market Value Realized Value for short-term holders (STH-MVRV) revealed worrying data. The values recorded in the current bear cycle have been lower than those recorded during the December 2018 BTC market capitulation.

This, according to Glassnode, indicated that BTC short-term holders currently experience a “historically large degree of financial pain.” 

The report noted further that since the middle of August, the total percent supply in loss rallied by 11.8%, to be pegged at 48.1%. Glassnode further found that the contribution of short-term holders has been significantly higher than that of long-term holders.

This, according to Glassnode, suggests “capitulation” amongst short-term holders in the market. This can also be a corresponding demand inflow when the price of BTC oscillated between $24,000 and $18,500 last week. 

It added further that the difference in the contribution of short-term holders and that of long-term holders indicates a risk. This being “that a large volume of investor coins (48.1% of supply) are underwater below $18.5k.