Bitcoin May Be Near Cycle Bottom as Most Supply Sits at a Loss
Research firm K33 says more than half of Bitcoin's supply is underwater, a signal that has historically preceded major bottoms.
Bitcoin could be approaching a cyclical price floor, according to crypto research firm K33, which found that more than half of the cryptocurrency's circulating supply is currently being held at a loss — a rare threshold that has historically marked the final weeks before a market bottom.
K33's analysis shows this metric has appeared only a handful of times across previous Bitcoin market cycles, and in most instances, the digital asset posted strong one-year returns after crossing that threshold. The pattern suggests that widespread holder capitulation, while painful, has repeatedly served as a contrarian buy signal rather than a harbinger of further collapse.
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The broader context matters here: Bitcoin has faced persistent macro headwinds in 2025, including elevated interest rates, regulatory uncertainty, and risk-off sentiment across global markets. K33's findings offer a data-driven counterpoint to near-term pessimism, framing the current distribution of losses not as a warning sign but as a potential setup for recovery consistent with prior cycles.
Still, historical patterns in a relatively young and volatile asset class carry inherent limitations. No two market cycles are identical, and external macro shocks could delay or disrupt the recovery timeline that past data implies. Investors watching this metric will likely treat it as one input among many rather than a definitive signal.
The K33 report adds to a growing body of on-chain analysis suggesting that long-term Bitcoin holders have begun absorbing supply from capitulating short-term participants — a dynamic that, if prior cycles hold, could set the stage for the next sustained upward move. Continue reading at Cointelegraph.
