On-chain analytics firm Glassnode has revealed that the severity of Bitcoin market pullbacks during bull cycles has weakened as the cryptocurrency market matures.
Historically, Bitcoin bull markets are characterized by strong price increases followed by significant selling pressure, but the data shows a clear trend of decreasing volatility in the current cycle.
The most significant pullback in this bull market occurred on August 5, 2024, when the price of Bitcoin fell by 32%. However, Glassnode notes that in most of the pullbacks in this cycle, Bitcoin fell only 25% from local highs, and the volatility of this cycle was among the lowest ever recorded.
This stability is attributed to a combination of factors, including the launch of spot Bitcoin exchange-traded funds (ETFs) that have generated significant demand and growing interest from institutional investors.
Glassnode analysis reveals that the majority of short-term Bitcoin holders are currently “in a loss state,” meaning the market price of their coins is below their purchase cost, but they are not experiencing the extreme unrealized losses typically associated with market declines.
This suggests that short-term holders remain resilient even during corrections, due to increased confidence driven by market developments such as institutional adoption and ETF launches.
*This is not investment advice.
