Bitcoin realized profit/loss ratio falls below 1, signaling market capitulation

According to on-chain analytics firm Glassnode, the 90-day moving average of Bitcoin's on-chain realized profit/loss ratio has fallen below one, marking a full transition into a phase of excess realized losses. This signifies that investors' realized losses are outpacing the market's overall realized profits. Glassnode noted that historically, when this indicator drops below one, it has remained there for over six months before recovering. These periods tend to be characterized by widespread market capitulation, or panic selling. A recovery in the metric would suggest that liquidity is returning to the market, the firm explained.