Bitcoin buyers who purchased around when it hit a $109,000 all-time peak in January are now panic-selling as the cryptocurrency declines, says onchain analytics firm Glassnode, which isn’t ruling out that Bitcoin could slide to $70,000.

Glassnode said in a March 11 markets report that a recent sell-off by top buyers has driven “intense loss realization and a moderate capitulation event.”

Short-term holders fled as Bitcoin dropped from peak

The surge in buyers paying higher prices for Bitcoin (BTC) in recent months is reflected in the short-term holder realized price — the average purchase price for those holding Bitcoin for less than 155 days.

In October, the short-term realized price was $62,000. At the time of publication, it’s $91,362 — up about 47% in five months, according to Bitbo data.

Meanwhile, Bitcoin is trading at $81,930 at the time of publication, according to CoinMarketCap. This leaves the average short-term holder with an unrealized loss of roughly 10.6%.

Bitcoin is down 5.90% over the past seven days. Source: CoinMarketCap

Glassnode said that short-term holders’ realized price shows it is apparent that “market momentum and capital flows have turned negative, signaling a decline in demand strength.” 

“Investor uncertainty is affecting sentiment and confidence,” it added.

Glassnode said that short-term holders are “deeply underwater” between $71,300 and $91,900 and warns that Bitcoin could bottom out as low as $70,000 if selling persists.

“The probability of forming a temporary floor in this zone is meaningful, at least in the near term,” Glassnode said.

Bitcoin short-term holders are “deeply underwater” between $71,300 and $91,900. Source: Glassnode

Market research firm 10x Research labeled it a “textbook correction” in a March 10 note, adding that with Bitcoin’s dip below $80,000, “approximately 70% of all selling came from investors who bought within the last three months.”

Related: Bitcoin slides another 3% — Is BTC price headed for $69K next?

On the same day, BitMEX co-founder Arthur Hayes said that Bitcoin may retest the $78,000 price level and, if that fails, may head to $75,000 next.

Glassnode explained that a similar sell-off Bitcoin pattern was seen in August when Bitcoin fell from $68,000 to around $49,000 amid fears of a recession, poor employment data in the United States, and sluggish growth among leading tech stocks.

However, Bitcoin has spiked 7.5% over the past 24 hours as the US market steaded on March 11 after plunging a day earlier after US President Donald Trump refused to rule out that a recession was on the cards.

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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.