New on-chain data has raised the possibility that the bear cycle in the Bitcoin market may not have reached its final stage. According to CryptoQuant data, while the amount of realized losses among investors has increased, the total realized loss seen in the 2022 bear market has not yet been surpassed. This suggests that, if past patterns repeat, there could still be an additional wave of liquidations in the market.
Realized losses lag behind 2022 levels
An assessment published on the CryptoQuant platform indicates that realized losses are calculated in US dollars and that, as the market capitalization of Bitcoin grows, the dollar value of losses in similar investor behaviors would also be expected to increase. However, in the current cycle, this metric remains below that of the previous major bear market.
Glossary: Realized loss refers to the loss that occurs when a crypto asset is transferred on-chain at a price lower than a previous transfer price. This indicator is used to measure periods when investors sell their assets at a loss.
CryptoQuant contributor Darkfost, who provided the analysis, noted that realized losses during the 2022 bear market totaled $211 billion, marking a record for that period. In the current cycle, approximately $174 billion in losses have been recorded since the peak in October. Notably, despite Bitcoin’s higher market capitalization in US dollar terms, this figure remains below the 2022 level.
A new wave of selling at a loss may occur if the market follows historical patterns. This could indicate that the downturn might deepen for a while longer, according to Darkfost.
Darkfost believes this scenario suggests the possibility of further cleansing in the market, although it is still subject to interpretation. The analysis highlighted that the bear market bottom may take a few more months to form.
Retail investor interest remains resilient
Another noteworthy aspect of the market structure is retail investor behavior. According to market commentator Ardi, small investors continued to buy as prices fell, actively trying to catch the bottom. In contrast, mid-sized and institutional participants took the opportunity to exit during short-term recoveries.
For months, retail investors saw every pullback as a buying opportunity, while larger players used this optimism to sell, observed Ardi.
Ardi emphasized that belief among individual investors remains remarkably strong, making it harder to declare current lows as the definite market bottom. In his view, as long as this behavior persists, true capitulation in the market is unlikely.
These observations keep questions alive regarding whether the recent low levels in Bitcoin’s price truly mark the bottom of the bear market. When on-chain loss data is considered alongside investor behavior, the possibility of continued downward pressure in the market cannot be entirely ruled out.
Bitcoin realized losses reached $174 billion following the October peak, as new data suggests the decline could persist.
