40% of bitcoin traders underwater: Glassnode data

Bitcoin is off nearly 55% from its November peak, and 40% of holders at the moment are underwater on their investments, in keeping with new data from Glassnode.

That proportion is even larger if you isolate for the short-term holders who bought pores and skin within the game within the last six months when the value of bitcoin peaked at around $69,000.

Within the last month alone, 15.5% of all bitcoin wallets fell into an unrealized loss, as the world's most popular cryptocurrency plunged to the $31,000 level, monitoring tech stocks decrease. Bitcoin's close correlation to the Nasdaq challenges the argument that the cryptocurrency capabilities as an inflation hedge.

Analysts from Glassnode also noted an influx of "pressing transactions" amid this latest sell-off, in which buyers paid larger charges, indicating they were prepared to pay a premium in order to expedite transaction instances. The entire worth of all on-chain transaction fees paid reached 3.07 bitcoin during the last week — the largest yet recorded in its dataset.

"The dominance of on-chain transaction fees associated with exchange deposits also signaled urgency," continued the report, further supporting the case that bitcoin buyers were seeking to de-risk, sell, or add collateral to their margin positions in response to current market volatility.

Throughout the sell-off this past week, more than $3.15 billion in value moved into or out of exchanges, the largest amount for the reason that market hit its all-time excessive in November 2021.

Most wallet cohorts, "from shrimp to whales," have softened in their on-chain accumulation traits, according to the report, referring to both small-scale and large-scale investors.

Wallets with balances of greater than 10,000 bitcoin have been a very important distributive force over the previous few weeks.

And while there is extra conviction amongst retail buyers — information shows that these holding less than 1 bitcoin are the strongest accumulators — the accumulation among these smaller-scale holders is notably weaker than it was in February and March.

Fundstrat Global Advisors is looking a backside of round $29,000 a coin, and the firm is now advising clients buy one-to-three month put protection on long positions.

— CNBC's Kate Rooney contributed to this report