Bitcoin Market Structure Strengthened Following Brief Slide to $100,000
According to a report by Glassnode on June 10, on-chain data reveals that Bitcoin’s recent dip to $100,000 actually reinforced market structure rather than weakening it. Despite experiencing a 9% drawdown after reaching a record high of $111,965 on June 7, the realized losses amounted to only $200 million, significantly lower than previous corrections during this cycle.
The majority of selling pressure came from holders with Bitcoin holdings younger than one week, indicating that the capitulation was primarily driven by new market participants rather than long-term investors. Interestingly, addresses that had held Bitcoin for over three months did not engage in any profit-taking during this downturn.
Open interest decreased by $2.3 billion, marking the seventh-largest deleveraging event since 2023. This decline was mainly attributed to derivatives liquidation rather than spot distribution. Despite the downward movement, Bitcoin price managed to bounce back before testing the short-term holder cost basis at $97,600 and remained above the psychological $100,000 level.
The report emphasized that maintaining this price band is crucial for sustaining cyclical momentum, as 41% of trading days since the 2022 bottom have seen more significant pullbacks. Long-term holders were able to realize a profit of $930 million per day at the recent peak, aligning with the pace observed during March’s breakout above $100,000 but still lower than the peak of $1.64 billion in early April.
Interestingly, despite increased spending, the aggregate balance of long-term holders continued to rise, a trend not commonly seen during late-cycle conditions. This was attributed to exchange-traded fund (ETF) custody programs and other institutional channels that effectively remove coins from circulation.
The realized profit-loss ratio for long-term holders reached 9.4, a level surpassed on less than 16% of trading days since 2011, typically associated with euphoria. Additionally, the UTXO Realized Price Distribution indicated a concentration of coins acquired in the $100,000 to $103,000 range, with the current price hovering at the upper end of this cluster.
As the price sits within this dense band, with historical volume above it being relatively light, there is an “air gap” region that could facilitate rapid price movements if demand remains strong. The Realized Supply Density, which gauges the share of supply with a cost basis near the spot price, has increased alongside the recent rally, indicating heightened sensitivity.
Despite the overall positive outlook, options traders seem unconcerned, as implied volatility for both short and long tenors continues to decline. This stance has historically preceded volatility spikes in previous cycles, suggesting the potential for significant price movements if Bitcoin retests its all-time high.
In conclusion, the swift recovery above $100,000 following last week’s decline suggests that the uptrend remains intact and indicates that demand successfully absorbed the largest futures-driven shakeout in two months. As Bitcoin continues to navigate through market fluctuations, maintaining a strong market structure is essential for long-term sustainability and growth.