Key Takeaways
- Glassnode says roughly 7.75 million BTC is currently being held at a loss.
- Analyst Benjamin Cowen argues Bitcoin’s four-year cycle remains intact.
- Crypto Rover warned Bitcoin may have triggered a bearish “liquidity trap”.
Bitcoin’s latest slide has pushed a large portion of the network into underwater territory, with on-chain analytics firm Glassnode warning that roughly 7.75 million BTC — nearly 39% of the circulating supply — is currently underwater.
The move has sparked fears that the market could face deeper bearish pressure before a durable bottom forms.
Glassnode Flags Bitcoin Held at Loss
In a post on X, Glassnode said the current “supply overhang” is a classic structural feature of bear markets, noting that such phases are “typically resolved only as weaker hands capitulate.”
The data comes as Bitcoin trades around $77,000, down roughly 39% from its October 2025 all-time high near $126,000.
Glassnode’s accompanying chart showed the 7-day moving average of Bitcoin supply held at a loss surging to levels historically associated with major correction phases, including the 2018 and 2022 bear markets.
However, recent on-chain data suggests the most severe wave of forced selling may already be easing.
Glassnode data showed daily realized losses recently fell to around $81.6 million, significantly below peaks recorded earlier this year, while Net Realized Profit/Loss has turned positive again at roughly $122 million over a 24-hour period.
Earlier in 2026, large Bitcoin holders controlling between 10,000 and 100 BTC reportedly realized $30.9 billion in losses during the first quarter, marking the largest capitulation event since 2022.
Benjamin Cowen Says Bitcoin’s Four-Year Cycle Remains Intact
The Glassnode warning comes as analysts continue to debate whether Bitcoin’s traditional four-year cycle remains valid.
Crypto analyst Benjamin Cowen argued in a recent X thread that Bitcoin’s current market structure still closely resembles prior post-halving bear market phases.
“The four year cycle for Bitcoin is not dead,” Cowen wrote, adding that Bitcoin topped “when it always topped.”
Cowen said that while Bitcoin’s drawdown has so far been milder than prior bear markets, several historical behaviors remain intact.
He pointed to Bitcoin’s recent rejection near the 200-day simple moving average — a level that historically acts as resistance during bear phases — as well as the relatively short duration of the current consolidation.
“In prior bear markets, there were countertrend rallies that lasted more than 20 weeks before a new local low was set,” Cowen wrote.
He noted the current consolidation has lasted only around 16 weeks.
Cowen also argued that Bitcoin’s current correction still broadly aligns with historical patterns of return-on-investment decay across previous cycles.
“…there is still plenty of evidence to suggest that the four year cycle remains in tact, and that once again people thought “this time was different” when it was not,” he wrote.
Historical Bitcoin Cycles Suggest More Losses Ahead
Historically, Bitcoin has followed a relatively consistent four-year cycle tied to its halving events.
Prior bear markets in 2014–2015, 2018, and 2022 produced drawdowns ranging between 75% and 87% from peak to bottom.
Cycle bottoms have typically formed around 12 months after major peaks, often during US midterm election years.
While arguably similar, the current cycle has a magnitude.
Bitcoin peaked 18 months after the April 2024 halving, but the decline from its October high has only reached 39%.
Some analysts argue that institutional adoption and ETF-driven demand have helped moderate volatility compared with earlier cycles.
However, other analysts, such as Cowen, argue that there could still be further downside.
Crypto Rover Warns of ‘Liquidity Trap’
Meanwhile, crypto trading profile Crypto Rover warned that Bitcoin may have recently flashed another bearish technical signal.
In a post on X, Crypto Rover said that Bitcoin had “swept liquidity above the bull market support band.”
This “liquidity trap” is often interpreted as a false breakout that traps bullish traders while forcing short sellers to close positions early.
“Not a good sign,” the analyst wrote.
The failed reclaim of the Bull Market Support Band has historically been viewed as a warning that bullish momentum may be weakening.
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
