Indicator Overview

The indicator calculates the percentage of the total BTC supply held by Long-Term Holders (LTHs) (those holding coins for more than 155 days) that is currently at an unrealised loss. The metric is presented as a proportion between 0 and 1, with a 7-day smoothing for trend clarity. This percentage reflects the aggregate financial stress on the resilient market cohort.

How To Use

This metric tracks the macro-cycle accumulation and distribution phases based on the losses held by strong hands. Historically high readings (approaching the higher zone of the historical range) signal that a significant portion of the resilient LTH supply is underwater. This indicates deep financial pain and conviction for the strong hands, aligning with major cycle bottoms and offering strong contrarian buying opportunities. Conversely, if the metric reaches historically low levels (approaching 0), it implies nearly all LTHs are profitable. This lack of stress is typical of the euphoric late stages of a bull market, suggesting caution as the incentive for LTHs to distribute their supply is maximal. A rapid increase from low levels often accompanies major market crashes.