BTC Market Approaching Capitulation as Short-Term Investors Experience Significant Losses

Bitcoin’s (BTC) on-chain metrics are signaling a significant trend once again, as the short-term holder (STH) MVRV ratio has dropped to 0.82 — a level typically associated with market stress and capitulation, according to data from Glassnode. This metric assesses the market value (current BTC price) against the realized price (average cost basis of coins held by short-term holders). A STH MVRV value below 1.0 indicates that recent buyers are, on average, experiencing unrealized losses. Specifically, at 0.82, short-term holders are down approximately 18% on average, suggesting that many are facing considerable challenges.

This level closely resembles previous MVRV cycle lows: 0.84 in August 2024 and 0.77 in November 2022, both of which preceded market bottoms and trend reversals.

BTC: STH-MVRV (Glassnode)

Historically, such significant MVRV declines have signaled periods when weaker hands capitulate and smarter investments begin to accumulate.

According to Glassnode data, since February, long-term holders (investors holding for 155 days or more) have increased their cohort supply by roughly 500,000 BTC. In contrast, short-term holders have distributed over 300,000 BTC, a movement driven by both profit-taking and capitulation. This disparity suggests that long-term holders are accumulating more BTC than short-term holders are liquidating.

BTC: Long/Short Term Holder Threshold (Glassnode)