Bitcoin’s Tough Month: Glassnode Points to Short-Term Holders as Risk Factor

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Analysts point to a potential “source of risk” as short-term Bitcoin holders grapple with unrealized losses, raising concerns of potential sell-off pressure.

In a September 4th Glassnode report, the analytics firm pointed to short-term Bitcoin holders, those who have held Bitcoin for under 6 months, as a risk factor.

While the average Bitcoin investor remains in a profitable position, these recent entrants continue to hold at an unrealized loss, which could lead to substantial sell-side pressure in the event of a further market correction.

Glassnode noted that the situation is more reminiscent of the choppy market conditions seen in 2019, rather than a full-scale bear market. However, it still presents a considerable risk, the report added:

“Until the spot price reclaims the STH [Short-Term Holder] cost basis of $62.4k, there is an expectation for further market weakness.”

This dynamic creates a potentially volatile situation, as these holders are “shouldering the majority of the market pressure” going into what is anticipated to be Bitcoin’s toughest month.

This development comes amidst what has historically been a volatile month for Bitcoin, with September consistently delivering the worst returns.

Historically September is a very bad month for #Bitcoin.

Will history repeat? pic.twitter.com/mItiBvWhX3

The sell-side pressure presented by short-term holders only adds to the biggest risk factor, a potential aggressive US Federal Reserve rate cut – something Bitfinex analysts cited as a potential catalyst for a 20% Bitcoin decline.

While a 25 basis