Lede
Bitcoin market participants have entered a notable period of realized net losses over a 30-day window, representing the first such occurrence since late 2023. This trend emerges after a period of more than two years that was largely dominated by realized profits for holders. According to data provided by Julio Moreno, who serves as the head of research at CryptoQuant, the rolling 30-day realized profit and loss metric for Bitcoin (BTC) has dipped below zero. This specific metric indicates that the coins moved on the blockchain during the past month were generally sold at a price lower than their initial purchase cost.
Julio Moreno observed that Bitcoin holders are realizing losses for a 30-day period for the first time since late 2023. The net realized profit and loss metric is used to measure the net magnitude of profit or loss realized by all holders who are spending their coins on-chain. While a negative reading on this metric does not necessarily mean a direct price decline for the asset, it suggests that the current selling pressure is increasingly originating from holders who entered the market at higher price levels. This shift marks a significant change in holder behavior compared to the consistent profitability trends observed earlier in the current market cycle.
Context
In contrast to the realized losses seen in the digital asset space, gold has demonstrated significant upward momentum, surging past the $4,700 per ounce mark for the first time. This rally is driven by rising geopolitical tensions which have led investors to seek traditional safe-haven assets. On Tuesday, spot gold reached a new all-time high of $4,701.23 before experiencing a slight easing in price. At the same time, US gold futures have also been setting fresh records, reinforcing the strength of the precious metal in the current economic climate.
Silver has closely followed the performance of gold, trading near its own historic highs. During recent trading, silver briefly touched a price of $94.72 per ounce. This divergent performance between precious metals and Bitcoin has caused the Bitcoin-to-gold ratio to drop sharply. According to data from Bitfinex, this ratio is currently down more than 50% from its previous peak. This decline highlights the relative underperformance of Bitcoin when compared to gold during this specific period of global market instability and deteriorating investor sentiment as traditional commodities reach new historical milestones.
Impact
The current market environment is heavily influenced by international trade developments and political rhetoric. US President Donald Trump has warned of new trade measures that could be directed at European allies. These warnings have revived concerns regarding the possibility of a broader trade conflict, which has contributed to a deterioration in global market sentiment. Farzam Ehsani, the co-founder and CEO of Valr, noted that this aggressive trade rhetoric is pushing the market back into a state of de-risking. Ehsani further commented that historical tariff threats and retaliatory measures have typically created significant headwinds for digital currencies and other risk-oriented assets.
This de-risking sentiment is reflected in the recent performance of institutional investment products. US-listed spot Bitcoin exchange-traded funds (ETFs) recorded $394.7 million in net outflows on Monday. This significant outflow snapped a previous four-day streak of inflows. During that prior streak, the spot Bitcoin ETF products had successfully brought in more than $1.8 billion in net investment. The sudden reversal in ETF activity suggests a cooling of institutional appetite as traders react to the changing global trade landscape and the renewed strength of traditional safe-haven assets like gold and silver.
Outlook
The outlook for Bitcoin remains tied to its relationship with traditional assets and the behavior of its holders. The Bitcoin-to-gold ratio, currently down more than 50% from its peak, is a metric of significant interest to market analysts. Bitfinex has noted that in previous instances where the ratio reached these levels, Bitcoin eventually went on to outperform gold. However, the current period is characterized by the first 30-day stretch of realized net losses for holders since late 2023. This transition below zero for the rolling 30-day profit and loss metric is a key indicator of the current selling pressure from those who bought at higher levels.
As global trade tensions continue to influence market participants, the role of safe-haven assets remains prominent. Gold’s recent climb to an all-time high of $4,701.23 on Tuesday and its continued position above $4,700 per ounce set a high benchmark for alternative assets. Investors are monitoring whether the current de-risking mode, as described by Valr CEO Farzam Ehsani, will persist in the face of new trade measures. The reversal of the $1.8 billion inflow trend into spot Bitcoin ETFs, marked by the $394.7 million outflow on Monday, suggests that institutional caution may continue as long as geopolitical uncertainties remain a primary driver of global sentiment.
About the Author
