Glassnode
Bitcoin's bottom is still under construction, but its character is shifting. Long-term holder capitulation has cooled from its cycle peak, buyers absorbed the June lows, and price is climbing back toward the levels that capped it. The Entity-Adjusted Long-Term Holder Realized Loss set its cycle peak two weeks ago and has now turned down, the first time this cycle the metric defining the bottoming process has fallen instead of risen.
Bitcoin also led the macro response. After a soft US inflation print, BTC moved more than any major equity index, its best reaction to good news in weeks. The correlation with US equities has been easing since winter while the inverse link to the dollar has deepened, suggesting liquidity, not risk appetite, is in the driver's seat. Ten-year real yields sit near a 2026 high around 2.4% and the dollar has held above its 200-day average since May, yet equities remain close to highs and credit spreads near their tights.
Why it matters
The cost-basis map frames the trade. BTC trades above the Realized Price, the natural floor of a bear market, but below the Short-Term Holder Cost Basis near $69K, the break-even of buyers from the past five months and the next overhead resistance. A convincing reclaim of that level would give the recovery room to run; a rejection keeps the range intact. The Relative Long/Short-Term Holder Realized Profit and Loss split shows profit-taking from old hands has dried up almost completely, with long-term holder selling now happening at a loss, the signature of a late-stage bear.
The macro identity is also drifting. Bitcoin trades less like a stock proxy and more like an asset that firms when the dollar weakens. If conditions ease from here, the dollar-and-liquidity channel is the one most likely to move first.
Market impact
The off-chain tape mirrors the on-chain turn. US spot ETF redemptions have slowed sharply from their June extreme, though one session this week produced the heaviest single-day outflow in weeks before partially recovering. The Options Put/Call Ratio has fallen to its year-to-date low, perpetual funding sits just above neutral, and 25-Delta Skew has drained well below its February extreme. DVOL sits near its lowest in a year and spot is pressing against max pain from below for the first time in weeks.
Confirmation is still missing. ETF flows bleed, the derivatives unwind lacks spot follow-through, and volatility sits compressed waiting for a catalyst.
Frequently asked questions
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What does it mean that long-term holder capitulation has turned down?
The Entity-Adjusted Long-Term Holder Realized Loss set its cycle peak two weeks ago and has now declined. For the first time this cycle, the metric defining the bottoming process is falling instead of rising, suggesting the wave of selling that met every rally is no longer building.
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Why is the Short-Term Holder Cost Basis near $69K so important?
It is the average entry price of buyers from the past five months and sits as overhead resistance. A convincing reclaim would give the recovery room to run, because trapped buyers above are most inclined to sell when made whole; a rejection keeps the range intact.
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How did Bitcoin react to the latest US inflation print?
BTC moved more than any major equity index on the soft inflation release, its best response to good news in weeks. After a month grinding sideways near the lows, the market is reacting to good news again, a sign sellers are spent.
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Is the link between Bitcoin and equities breaking down?
Correlation with US equities has been easing since winter while the inverse relationship with the dollar has deepened. Bitcoin trades less like a stock proxy and more like an asset that firms when the dollar weakens, putting liquidity, not risk appetite, in the driver's seat.
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What is the missing piece confirming the bottom?
Spot-driven buying carrying price through the Short-Term Holder Cost Basis near $69K and holding there. ETF redemptions have slowed but have not flipped to inflows, and the derivatives unwind lacks spot follow-through, leaving volatility compressed while waiting for a catalyst.
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