Short-Term Holders Send $3B in Bitcoin to Exchanges at a Loss as Mideast Tensions Rise

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In the past two days, Sept. 30-Oct. 1, bitcoin (BTC) registered consecutive declines of 3.7% as geopolitical tensions ramped up in the Middle East, culminating in Iran’s 200 ballistic- missile attack on Israel on Tuesday.
With the largest cryptocurrency little changed on Wednesday, this year marks the worst-ever start to an October, a month that’s historically provided positive returns.
One headwind comes from so-called short-term holders, which Glassnode defines as investors who have held bitcoin for less than 155 days. This is a group that tends to panic-sell when the BTC price drops below their cost basis. Glassnode data shows this cohort has bought roughly 100,000 bitcoin since Sept. 19, when bitcoin was trading at $62,000.
By Sept. 27, bitcoin had surged to above $66,000, and, as the chart shows, this group was buying aggressively as the price increased. However, they started dumping their holdings as the price started to fall.
In the past two days, short-term holders have sent roughly 64,000 bitcoin to exchanges, the equivalent of $4 billion. Of that, some $3 billion was sent at a loss, meaning it was sent when the price was lower than the entity’s average on-chain acquisition price.
This is the highest amount of loss sent to exchanges by the group since Aug. 5, during the yen carry trade unwind, which saw $2.5 billion of losses sent in one day.
Long-term holders, on the other hand, seem to be holding their nerve. As a group, they sent just 100 bitcoin at a loss to exchanges over the same time frame.
Edited by Sheldon Reback.

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As the senior analyst at CoinDesk, James specializes in Bitcoin and the macro environment. Previously, his role as a research analyst at Swiss hedge fund Saidler & Co. introduced him to on-chain analytics. He monitors ETFs, spot and futures volumes, and flows to understand Bitcoin.