40% of bitcoin traders underwater: Glassnode data

Bitcoin is off almost 55% from its November peak, and 40% of holders are now underwater on their investments, in keeping with new data from Glassnode.

That share is even greater while you isolate for the short-term holders who acquired skin within the sport in the last six months when the worth of bitcoin peaked at round $69,000.

In the final month alone, 15.5% of all bitcoin wallets fell into an unrealized loss, because the world's hottest cryptocurrency plunged to the $31,000 degree, tracking tech shares decrease. Bitcoin's close correlation to the Nasdaq challenges the argument that the cryptocurrency functions as an inflation hedge.

Analysts from Glassnode also famous an influx of "urgent transactions" amid this latest sell-off, wherein investors paid greater charges, indicating they were prepared to pay a premium in an effort to expedite transaction times. The total value of all on-chain transaction fees paid reached 3.07 bitcoin over the past week — the largest but recorded in its dataset.

"The dominance of on-chain transaction fees related to exchange deposits also signaled urgency," continued the report, further supporting the case that bitcoin buyers had been looking for to de-risk, sell, or add collateral to their margin positions in response to current market volatility.

Throughout the sell-off this past week, greater than $3.15 billion in value moved into or out of exchanges, the most important amount because the market hit its all-time high in November 2021.

Most wallet cohorts, "from shrimp to whales," have softened of their on-chain accumulation traits, according to the report, referring to each small-scale and large-scale investors.

Wallets with balances of greater than 10,000 bitcoin have been a very significant distributive force over the last few weeks.

And while there may be more conviction amongst retail investors — data shows that those holding lower than 1 bitcoin are the strongest accumulators — the accumulation amongst these smaller-scale holders is notably weaker than it was in February and March.

Fundstrat World Advisors is looking a bottom of round $29,000 a coin, and the firm is now advising shoppers buy one-to-three month put protection on lengthy positions.

— CNBC's Kate Rooney contributed to this report