Bitcoin Surrenders Are Many — Data Shows Record Realized and Unrealized Losses

Three weeks after the collapse of FTX, Bitcoin (BTC) analysts are scrutinizing the data to determine whether further selling will follow or if a bear market has hit.

One thing miners, short-term holders and long-term holders have in common is that they are currently losing in the Bitcoin market.

The magnitude of both realized and unrealized losses for Bitcoin holders is one of the heaviest surrender events in BTC history, according to Glassnode’s on-chain analysis. Capitulation has prevented all groups from increasing bankruptcies and declining minor earnings.

Bitcoin’s Realized Loss Is The 4th Largest On Record While Unrealized Losses Rise

November marked $10.8 billion in 7-day realized losses for Bitcoin. The biggest realized loss in Bitcoin history was his in June 2022, when he recorded $19.8 billion. Such losses show that a large amount of bitcoin has been traded at a discounted price.

A popular cryptocurrency investment adage is, “You can’t lose if you don’t sell.” Unrealized losses track the entire Bitcoin market relative to market cap. The 56% unrealized loss in November 2022 is the largest in the current bear market. Between 2014 and 2015, unrealized losses for Bitcoin holders reached an all-time high of 86%. The current unrealized loss is his fourth largest in Bitcoin history.

According to Glassnode analysts:

“The indicator recently peaked at 56%, the highest of the cycle and matching the lower end of previous bear markets.”

Block Times Slower As Bitcoin Miners Struggle

Bitcoin investors aren’t the only ones surrendering in the current market. Bitcoin miners are struggling to maintain profits at a sluggish price.

there it is. Hash Ribbon Miner surrender confirmed. In the wake of his $10 billion FTX scam and subsequent collapse, Bitcoin miners are bankrupt and hashrates are trending downward. pic.twitter.com/TorX7PzrNu

— Charles Edwards (@caprioleio) November 28, 2022

This affects the hash rate of BTC mining as Bitcoin miners are under pressure to survive economically. A drop in the Bitcoin hashrate slows down BTC transactions. According to the HashRate Index, his block time reached over 11 minutes.

Bitcoin hash rate drops sharply ↘️

Bitcoin’s 7-day average hashrate is currently at 236 EH/s, down 14% from 274 EH/s ATH.

As a result, block times have slowed down: average 11 minutes 12 seconds in this epoch https://t.co/JN7OmpJ8X0 pic.twitter.com/ckxqEqOGqX

— Hashrate Index (@hashrateindex) November 28, 2022

Despite current challenges, analysts believe a capitulation will be healthy to start the next bull market.

“One of the consistent events motivating bear-to-bull transitions is the dramatic realization of losses as investors give up and capitulate massively.”

With so many groups at a loss at this stage of the post-FTX bear market right now, Bitcoin and overall market sentiment are improving to stimulate new money to propel the bull market. If sentiment does not improve, a surrender may not coincide with previous Bitcoin cycles.