Although Bitcoin is currently experiencing low volatility and high on-chain losses, the overall UTXOs in loss still have yet to reach the levels of previous market bottoms.
While Bitcoin’s sellers may have yet to surrender enough, present trends indicate the end of bear markets.
Data suggest sellers behavior is starting to form a macro price bottom. It further has revealed that the Bitcoin network is currently experiencing a low-volatility, high-loss period – hinting that the latest bear market may soon end.
The Seller Exhaustion Constant is a number that indicates the current profitability of on-chain transactions and one-month rolling volatility. The number is currently lower than it has been in recent history.
According to a Twitter post, there have only been seven times in the past when Bitcoin has hit such low prices. In six of those instances, the market experienced an upswing afterward, implying that the current bearish trend could soon come to an end.
Glassnode commented, “The Bitcoin seller exhaustion constant recently hit its lowest value since November 2018.” In another conversation, Checkmate (Lead on-chain analyst) stated that the data is standard for bear markets, which typically happen near the lows.
Even though there is more data on unspent transaction outputs (UTXOs), the current levels of BTC moved on-chain at a loss are different from historical bear market lows.
ARK Invest and David Pull, the creator of the popular Puell Multiple indicators, originally established the Seller Exhaustion Constant. According to ARK analyst Yassine Elmandjra, the “seller exhaustion constant” is the percentage of bitcoins that are in profit multiplied by their volatility over the last 30 days.
October 29th is the most recent date, with available statistics showing that 75% of UTXOs were profitable. This is a noteworthy difference when compared to the late months of 2018 when this number fell below 50%.