BTC Market Near Capitulation as Short-Term Holders Face Deep Losses

Bitcoin’s (BTC) on-chain metrics are flashing a key signal once again, as the short-term holder (STH) MVRV ratio fell to 0.82 — a level historically associated with market stress and capitulation, according to Glassnode data.

This metric compares the market value (current BTC price) to the realized price (average cost basis of coins held by short-term holders). A STH MVRV value below 1.0 indicates that recent buyers are, on average, underwater, holding unrealized losses. At 0.82, this means short-term holders are down roughly 18% on average, a sign that many are experiencing significant pain.

This level closely mirrors previous MVRV cycle lows: 0.84 in August 2024 and 0.77 in November 2022, both of which preceded market bottoms and trend reversals.

Historically, such deep MVRV drawdowns have marked periods where weak hands capitulate and smart money accumulates.

According to Glassnode data, since February, long-term holders (investors holding for 155 days or more) have increased their cohort supply by approximately 500,000 BTC.

In contrast, short-term holders have distributed over 300,000 BTC, driven by a mix of profit-taking and capitulation. This imbalance indicates that long-term holders are accumulating more BTC than short-term holders are selling.