3.4 million BTC are in a loss, hitting a new high since 2018. Are long-term holders quietly accumulating?

As of April 9, 2026, on-chain data for Bitcoin shows that the supply of short-term holders in a loss position has risen to 3.4M BTC, the highest level since July 2018. This data comes from tracking analyses of on-chain coin movement time—short-term holders typically refer to address cohorts that have held Bitcoin for no more than 155 days. When the market price is below the purchase cost of the Bitcoin held by these addresses, the corresponding supply is defined as being “in a loss position.” Currently, more than 90% of short-term holder supply is “underwater,” meaning the cost basis of the vast majority of recent entrants is higher than the current market price. Historically, this proportion has only appeared in deep bear markets or at cycle bottom areas, such as in early 2015, late 2018, and after the FTX collapse in November 2022.

Who is taking the main losses in this market adjustment

Judging from on-chain coin distribution, the losses in this price correction are mainly concentrated among short-term participants who entered the market from the second half of 2025 through the first quarter of 2026. These investors bought in relatively higher price zones, and then the market moved into a choppy downward phase. Notably, the absolute size of the loss-bearing supply reached 3.4 million BTC, exceeding the 3 million level from the end of 2018, but given the growth in Bitcoin’s total supply and circulating market value, the relative proportion has not yet touched historical extreme values. This mismatch—“an all-time high in absolute losses, but not yet a bottoming out in relative terms”—reflects changes in market participation structure and capital scale. The entry of institutional capital and large-scale traders makes it easier for the absolute number of loss-bearing supply to break historical records.

What the accumulation behavior of long-term holders signals

In sharp contrast to the widespread losses of short-term holders, the cohort of long-term holders is restarting a systematic accumulation pattern. On-chain data shows that in the market cycles from 2023 to 2025, long-term holders have already gone through two clearly defined absorption phases, accumulating nearly 1.1M BTC in net additions. The first phase occurred from the second half of 2023 to the beginning of 2024, and the second phase ran throughout 2025 and extended into the first quarter of 2026. Long-term holders are defined as addresses holding for more than 155 days; the behavior of this cohort is often viewed as a proxy indicator for “smart money” or “resilient capital.” When long-term holders keep accumulating during the price decline phase, while short-term holders exit on a large scale with losses, historical on-chain data often points to the market completing the transfer of coins from weak hands to strong hands.

How far is the current market structure from the historical bottom?

By comparing the time relationship between the “peak loss-bearing supply of short-term holders” and the “initiation of accumulation by long-term holders” across past cycles, a detectable pattern can be seen: the two are usually 3 to 6 months apart. During the formation of bottoms in 2015, 2018, and 2022, after the loss-bearing supply of short-term holders peaked, the market did not reverse immediately. Instead, it went through a low-range consolidation and coin reallocation phase. With 3.4 million BTC still in a loss position, combined with long-term holders continuing to accumulate, this suggests the market is likely in the transition window between the accumulation phase and the bottom confirmation phase. It is important to emphasize that on-chain data describes the state of market structure, not a price forecasting tool. After this kind of structural divergence appears historically, the market may continue trading sideways for several weeks or even months, but the direction of its implication remains toward the bottom area rather than further deep drawdowns.

What is the on-chain logic behind the disagreement between new and old investors

The underlying logic of this divergence—“newbies getting stuck, veterans accumulating”—lies in differences in cost basis and behavioral inertia. Short-term holders’ decisions are more easily influenced by recent price swings and sentiment. Once the market turns downward, the psychological pressure caused by losses often leads to panic selling or passive holding. Long-term holders, however, have experienced a full cycle; their cost basis is generally lower, and their sensitivity to price fluctuations declines significantly. More importantly, the accumulation actions by long-term holders themselves gradually raise the market’s average cost basis, creating price support. On-chain data shows that the share of total supply held by long-term holders is still in the historically high range. This implies that the floating supply available for short-term market trading is relatively limited. After loss-bearing supply reaches an extreme level, the reduction in sell pressure together with the strengthening of accumulation forces often forms a marginal inflection point in the supply-demand relationship.

How to locate the current market cycle stage from on-chain data

From a more macro perspective, Bitcoin market cycles can be divided into four stages based on changes in long-term holders’ supply: the top distribution phase (long-term holders’ supply declines), the bear market bottom phase (long-term holders’ supply stabilizes and starts to rise), the early accumulation phase (long-term holders’ supply continues growing but prices remain lackluster), and the mid-stage of the bull market phase (long-term holders’ supply begins falling again). Current on-chain data shows that long-term holders’ supply is still in a net growth channel, indicating the market has not yet entered the late period of the cycle when long-term holders engage in large-scale distribution. Combined with the extreme reading of 3.4 million BTC of loss-bearing short-term holder supply, it can be inferred that the market is more likely in the window transitioning from the “early accumulation phase” to the “bottom confirmation phase.” The hallmark of this stage is narrowing price volatility, shrinking trading volume, and widespread pessimism—precisely the divergence from the coin structure changes reflected by on-chain data.

Which variables could break the existing accumulation-loss divergence structure

Even though the on-chain structure points to a higher probability of the bottom area, it is still necessary to watch for variables that could break this structure. First is the impact of the macroeconomic environment on Bitcoin as a risk-asset pricing mechanism—interest rate policy and liquidity changes can alter the valuation anchors of all risk assets. Second is the post-halving adjustment in the hash rate market; pressure on miners’ cash flow could lead to passive selling. Third is the evolution of regulatory policy, especially changes in crypto taxation and compliance frameworks in major economies. Fourth is the pace of development for Layer 2 and ecosystem applications; sustained low on-chain activity could extend the time needed for coin reallocation. These variables will not directly negate the historical implications of the on-chain divergence structure, but they can affect the time span over which the divergence converges and the final price center.

What kind of clearing process the market is undergoing, according to the on-chain coin distribution

If you look at the two sets of data—3.4 million BTC of loss-bearing supply and the 1.1 million BTC accumulated by long-term holders—more clearly, you can see the market’s clearing process: short-term speculative capital is absorbing losses and gradually exiting, while capital with a longer holding cycle is absorbing these coins in a systematic way. This clearing is not linear—it is typically accompanied by multiple false breakouts and repeated tests of lows. Each down move eliminates a batch of short-term holders, and each rebound attracts new long-term capital. The value of on-chain data is that it provides an observation dimension that does not rely on price itself: coins are shifting from cohorts that are highly sensitive to price to cohorts that are less sensitive to price. Once this process is completed, the sell pressure the market faces when it re-enters an upward channel will drop significantly. Based on historical cycles, the duration of this clearing process is typically between 6 and 12 months, and the current period is already in the middle-to-late part of that time window.

Summary

As of April 9, 2026, on-chain data for Bitcoin shows that the loss-bearing supply of short-term holders has reached 3.4 million BTC, the highest level since 2018, with more than 90% of short-term supply in a loss position. Meanwhile, across the 2023 to 2025 cycle, long-term holders have accumulated nearly 1.1 million BTC in total and restarted the typical bottom accumulation pattern. This divergence structure of “short-term loss supply setting new highs while long-term holders continue adding” has appeared near the bottoms of cycles multiple times in history, reflecting the market’s internal mechanism of transferring coins from weak hands to strong hands. The on-chain data does not serve as a price prediction tool, but rather an objective description of the market’s structural state. Within the current window, the marginal shift in the supply-demand relationship is being formed as short-term sell pressure fades and long-term accumulation continues; the market may be in the mid-to-late stage of a cycle transition.

Frequently Asked Questions (FAQ)

Q: What are “short-term holders” and “long-term holders”?

A: On-chain analysis typically uses 155 days as the dividing line. Addresses that hold Bitcoin for no more than 155 days are considered short-term holders, while those holding for more than 155 days are long-term holders. This classification is based on historical statistics— the probability that Bitcoin held for more than 155 days will be spent drops significantly.

Q: How is “loss-bearing supply” calculated?

A: By tracking the last movement time of each UTXO (unspent transaction output) and the Bitcoin price at the time of movement, and comparing it with the current market price. If the current price is lower than the price when that UTXO was last moved, then the supply associated with that UTXO is counted as being in a “loss position.”

Q: What does a loss-bearing supply of 3.4 million BTC mean?

A: It means that there are currently 3.4 million BTC whose holding costs are higher than the market price. This scale is the highest since 2018, reflecting that recent entrants are generally in an unrealized loss state. Historically, similar readings often show up near cycle bottom areas.

Q: Does long-term holder accumulation always lead to a price increase?

A: Not necessarily. Long-term holder accumulation indicates that the coin structure is improving, but a rebound in price still requires support from the demand side, including improvements in the liquidity environment, higher on-chain activity, and a recovery in market sentiment. On-chain data describes supply-side conditions, not demand-side signals.

Q: Has the market already confirmed the bottom?

A: The on-chain divergence structure is a necessary but not sufficient condition for a bottom area. In historical cycles, after this structure appears, the market usually still needs a consolidation and confirmation process lasting several weeks to several months. It is recommended to assess comprehensively using multi-dimensional data (such as spot trading volume, perpetual contract funding rates, miner sell pressure, etc.).