The Average Bitcoin Trader Is Down 45% Lowest Since DEC 2018

Pain continues for Bitcoin traders with the largest 16-month profit reversal since 2018.

Santiment Feed, in a tweet on Tuesday, has revealed that the average Bitcoin trader is facing a drawdown of about 45% as profits quickly turn to loss.

“The 365-day return for the average Bitcoin trader was +119% in late February, 2021. 16 months later, the same measurement for the average trader is -45%. This -164% reversal is the largest swing since December, 2018,” Santiment tweeted.

The 365-day return for the average #Bitcoin trader was +119% in late February, 2021. 16 months later, the same measurement for the average trader is -45%. This -164% reversal is the largest swing since December, 2018. https://t.co/Z3z5lfR0Gl pic.twitter.com/Lm8YLJ2HFg

— Santiment (@santimentfeed) July 5, 2022

Santiment in their chart highlights: “BTC 1-Year trading Returns Down to -45%, Now At DEC, 2018 Levels.”

It is worth noting the leading digital asset between April and June saw a 56.2% loss, diving from $45k to sub $20k price levels. It represents the worst quarter for the digital asset since Q3 2011. Additionally, according to Glass node, June was the worst month for the asset since September 2011, with the price tanking by over 37%.

This year has been difficult for all equity markets but more so for crypto. Rising inflation and central banks raising rates and reducing their balance sheet have left investors with little room for speculative investments creating a widely risk-off market environment even as fear of a recession builds. Notably, Bitcoin this year saw its longest streak of weekly losses, printing red weekly candles eight times in a row.

Consequently, market speculators have been driven out of the market, leaving only core Bitcoin believers. Glassnode reported on Monday that the on-chain activity of the digital asset had taken a significant hit, with active daily entities around 244,000, a significant low. 

However, despite these woes, whales and shrimps have been accumulating steadily, and Bitcoin supply on exchanges is at record lows. Early last week, Glassnode reported that whales now own about 8.69 million BTC, 45.6% of the available supply, accumulating at a rate of 140,000 BTC per month.

Big names like Michael Saylor’s MicroStrategy and Nayib Bukele’s El Salvador have all added to their holdings despite the uncertainty in the market. While detractors feel the move is foolhardy, Binance’s Changpeng Zhao has expressed his belief that these entities would have the last laugh.

Presently, there is no consensus on where the bottom is. Still, popular Bitcoin evangelist Michael Saylor has noted that we will see an upswing when technocrats and traders become Bitcoin believers.

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