Bitcoin Drops 15% Since March, 23% Supply in Loss

Bitcoin's recent price movements have sparked concerns among investors about the potential for further declines. The cryptocurrency's price has dropped below $80,000 due to recession fears, adding to the overall market uncertainty. This pullback phase has seen Bitcoin's price fluctuate between $82,488 and $86,500 within a 24-hour period, raising concerns about the potential for further price declines.

One of the key indicators of this uncertainty is the percentage of Bitcoin's supply that is in profit. Currently, 76.08% of BTC's supply remains in profit, which is the lowest it has been in six months. This means that 23% of the circulating supply, or around 4.56 million BTC, is in an unrealized loss. As more Bitcoin holders move into unrealized loss, some may decide to sell to limit further losses, potentially leading to deeper declines.

Despite the pullback, Bitcoin's price has continued to face substantial selling pressure. The cryptocurrency's value has dropped below the $84,000 mark, representing a 15% decline since the beginning of March. This selling pressure has been exacerbated by the fact that buying pressure from U.S. investors has remained low amid economic uncertainty, suggesting that retail buyers aren’t stepping up to absorb the selling pressure.

Institutional "dip-buying" has been gaining traction, with some investors taking advantage of the price drop to acquire more Bitcoin at a lower cost. However, the risks associated with this strategy remain elevated, as escalating sell-offs could lead to further liquidations, pushing Bitcoin below $80,000 again. The involvement of third-party players, possibly institutions, could also influence the market's next move.

Bitcoin's Estimated Leverage Ratio (ELR) has surged dramatically, indicating that derivatives traders are not de-leveraging but rather increasing leverage to take on higher-risk positions. This high-leverage risk in Bitcoin derivative trade could potentially lead to further volatility in the market. On March 9, Bitcoin experienced a 6.41% drop to $80,000, resulting in $195.86 million in liquidated long positions. This liquidation event highlights the risks associated with high-leverage trading in the cryptocurrency market.

In summary, the