Glassnode warns of deeper Bitcoin losses if $58.5K support fails

Blockchain analytics firm Glassnode has cautioned that Bitcoin could face further downside if the $58,500 support level breaks, according to a report cited by Wu Blockchain. The warning comes as spot trading volume for Bitcoin has dropped to its lowest level since the firm began tracking the data in 2019, signaling weak market participation.

Key metrics point to fragile market conditions

Glassnode noted that Bitcoin is currently trading between the median realized price of $63,000 and the average entry price for short-term holders of $68,700. The realized price represents the average cost basis of all coins on-chain, while the short-term holder cost basis reflects the typical purchase price for investors who have held for less than 155 days. This range indicates that many recent buyers are currently underwater, which could increase selling pressure if prices decline further.

The firm also observed that indicators of seller exhaustion are nearing levels seen at past bear-market bottoms. However, spot demand remains weak, with limited net inflows into Bitcoin exchange-traded funds (ETFs) and continued net inflows of BTC to exchanges, suggesting that investors may be preparing to sell rather than accumulate.