Bitcoin Market Pain: Short-Term Holders Face Heavy Losses As Realized Profit/Loss Ratio Turns Negative

Since the market shakedown caused by the US and China tariff frenzy, Bitcoin is still battling with volatility as its price loses the $110,000 price target again after a short upward move on Sunday. With BTC’s price experiencing bearish performance, investors, especially short-term BTC holders, are seeing notable losses in their positions.

Realized Losses Mount For Short-Term Bitcoin Investors

Amid the wave of market volatility and pullback in the price of Bitcoin, key on-chain data shows that short-term BTC investors are taking a hit. Specifically, this negative development is being unveiled by the Bitcoin Realized Profit/Loss (RPL) ratio for short-term holders.

In a post on the social media platform X, Darkfost, a CryptoQuant author and crypto enthusiast, shared that the BTC short-term holders’ Realized Profit/Loss ratio has undergone a sharp downturn. This negative shift points to growing pain among these investors and across the BTC market.

It also suggests that most investors who bought Bitcoin in the previous several weeks or months are now selling it for a loss. While this is a sign of capitulation in the short term, such moves typically mirror weak hands exiting the market, which is likely to precede major accumulation zones and long-term recovery. 

According to the market expert, short-term holders are struggling with losses. During the time of the post, the short-term holders realized the price was hovering around the $113,000 mark. 

Currently, the weakest hands in Bitcoin are being forced to capitulate due to its stagnation. This is evidenced by the drop in the STH realized P/L ratio to -1.4, a level comparable to the April 2025 correction. It is important to note that when short-term holders are under pressure, opportunities tend to present themselves, and a bottom eventually forms. 

Darkfost highlighted that the trend is precisely what has been observed throughout this cycle. Furthermore, the expert noted that the trend is the final phase of the ongoing correction. This narrative stands as long as there are sporadic, brief spikes in volatility during the generally upward trend.

Long-Term BTC Holders Are Exiting The Market

After navigating the Long-Term Holder Supply Net Position Change in the 30-day timeframe, Darkfost revealed that the Bitcoin long-term holders appear to be exiting the market. During the month of October, long-term holders also took advantage of the chance to lower their exposure.

There has been a 2.2% decline in the supply held by long-term holders, which translates into the distribution of over 330,000 BTC. This remains a modest reduction compared to December 2024. At that time, LTH supply fell by 5.2% and by 5.05% in March 2024, and both of them were roughly twice as large. 

In the meantime, Darkfost has declared this trend an important one that needs to be monitored closely. At the time of writing, Bitcoin’s price was trading at $107,544, caused by a nearly 3% decline in the last 24 hours. BTC’s price may be declining, but investors are starting to exhibit bullish sentiment as its trading volume has surged by more than 55% within the same time frame.