Bitcoin Fails to Regain Key Price Level Amid Rising Losses

Bitcoin Struggles Below Key Level

Bitcoin has been trading below the cost basis of a key investor group for the past week, according to on-chain data. The world’s largest cryptocurrency could face further headwinds if it fails to reclaim this critical level.

Short-Term Holders Face Losses

Crypto analyst Axel Adler Jr. noted on X on May 22 that Bitcoin is struggling to surpass its Short-Term Holder (STH) Realized Price, which he identifies as approximately $80,217. The STH Realized Price represents the average acquisition price of newer Bitcoin investors. When Bitcoin trades below this level, many short-term holders are holding unrealized losses, which can increase selling pressure.

Adler pointed out that realized losses have increased across the Bitcoin market. Net realized profit is now roughly -$176 million, stemming from $366 million in realized losses and $190 million in realized profits among Bitcoin short-term traders. Adler suggests that until Bitcoin surpasses the STH cost basis, any market rebounds may be temporary. These price recoveries below $80,217 could be relief rallies rather than indicators of a broader trend reversal. For Bitcoin to demonstrate bullish momentum, the price must decisively break above the former STH support, which may now act as resistance. As the price approaches the STH breakeven price, investors are more likely to sell, adding to bearish pressure.

Coinbase Sees Increased Selling Pressure

In another X post, Maartunn revealed that Coinbase is experiencing significant bearish pressure, the strongest since February. The Coinbase Premium Gap, which tracks buying and selling activity among US-based investors, has dropped into negative territory, coinciding with Bitcoin’s recent price decline. A positive premium typically indicates stronger buying activity on Coinbase, while a negative reading suggests increased selling pressure or weakening demand from US investors.

Historically, strong negative Coinbase premium readings have coincided with corrective phases or periods of short-term fear. However, they can also precede the establishment of local bottoms if selling exhaustion begins to emerge.

As of the time of writing, Bitcoin is valued at $75,514, down 2.56% in the last day.