Is Bitcoin (BTC) Facing a Potential Decline? Here is What to Know

The leading cryptocurrency remains close to the $62,500 level, showing only a marginal 1% surge over the past 24 hours.

Chain data suggests that the coin’s price may continue to trend weak as holders of short-term assets face continued pressure. Specifically, the cryptocurrency is still trading below the realized price for short-term holders (STH).

Crypto analyst Ali Martinez recently highlighted that the $63,000 threshold is the realized price for short-term holders of Bitcoin, emphasizing its importance to the asset’s overall outlook. The realized price for short-term holders is a metric that shows the average price at which these investors purchased their BTC.

When the spot price of Bitcoin exceeds the realized price for short-term holders, it usually means that these investors are making profits. This often leads to increased buying activity, creating positive sentiment in the market and potentially driving prices higher.

#Bitcoin has been trading below the short-term holder’s realized price since June 22.

When $BTC falls below this level, short-term holders may sell to avoid deeper losses, risking a cascading sell-off. Watch this level closely, currently at $63,000, for the next market move. pic.twitter.com/LFWr9AT7SV

— Ali (@ali_charts) October 5, 2024

Conversely, when Bitcoin’s price falls below STH’s realized price, it suggests that most short-term investors are experiencing unrealized losses. This situation may cause some investors to sell off their holdings to minimize losses, thus putting downward pressure on the price and increasing the likelihood of further declines.

Since June, BTC has consistently traded below the realized price for short-term holders, which currently stands at $63,000. According to Martinez, this puts Bitcoin at risk of further short-term declines.

Alexander Stefanov

With over 8 years of experience in the cryptocurrency and blockchain industry, Alexander is a seasoned content creator and market analyst dedicated to making digital assets more accessible and understandable. He specializes in breaking down complex crypto trends, analyzing market movements, and producing insightful content aimed at educating both newcomers and seasoned investors. Alexander has built a reputation for delivering timely and accurate analysis, while keeping a close eye on regulatory developments, emerging technologies, and macroeconomic trends that shape the future of digital finance. His work is rooted in a passion for innovation and a firm belief that widespread education is key to accelerating global crypto adoption.