The BTC price resets cause Bitcoin addresses to incur widespread losses
Bitcoin address losses hit a 1-month high while the USD breaks highest since July
By Shashank Bhardwaj
Latest reports suggest that over 17.5 million Bitcoin wallets are under losses as of 23 August, more than any other day in the past month. Bitcoin traders are under considerable pressure as BTC/USD has been below $21,000 five times since 19 August, according to data from Cointelegraph Markets Pro and TradingView.
Source: TradingView | BTC/USD 1 hour candle chart
With Bitcoin being at its lowest since the last week of July, the people who bought recently are also experiencing their wallets in the red, at various degrees. Moreover, the extent to which investors added positions to contribute to this month’s $25,500 highs is now clearer, with more BTC addresses facing an overall loss than at any time since 23 July.
Underwater addresses, i.e. those that hold assets that were purchased above the current price, have been very evident since last week’s sudden price drop. As of writing this article, the seven-day moving average (MA) of wallets in the red stands at upwards of 17.5 million. This portrays an increase of approximately 1.5 million over the last couple of days.
Source: Glassnode Twitter | Bitcoin 7-day addresses in loss chart
The monitoring resource, Coinglass, which covers liquidations of positions on derivatives exchanges also shows statistics that prove that the majority of losses incurred on 1 August, with price movements across $21,000, are not that important. Meanwhile, 19 August sealed the total figure of $209.5 million in long position liquidations on exchanges, which is the highest since 13 June. Furthermore, there were $30 million of short positions as well.
Rekt Capital, a trader and analyst, commented on the situation showing Bitcoin’s first close below the key 200-week MA since July. Others also highlighted that risk assets faced heavy resistance in the markets while the USD broke higher. The US dollar index (DXY) and Bitcoin have previously displayed an inverse correlation, to varying degrees. The DXY hit its highest since 14 July, crossing the 109 mark and up 4.4 percent since its woes in August.
The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash
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