Bitcoin's Market Structure Now Resembles Early 2022 — Cause For Concern?

Bitcoin (CRYPTO: BTC) has bounced off recent lows but continues to trade in a structurally fragile environment, defined by weakening demand and rising on-chain stress.

What Happened: Glassnode data shows Bitcoin holding above the True Market Mean, a key valuation band that historically separates shallow corrections from deeper bear phases.

But the broader market setup is increasingly echoing early 2022, with over 25% of BTC supply now sitting at a loss and price trading below major cost-basis quantiles.

Unrealized losses have surged to 5–7 million BTC, the highest since 2023 and nearly identical to the stagnation zone seen in early 2022.

Still, capital momentum remains slightly positive, with realized cap expanding by roughly $8.7 billion per month.

This steady inflow is helping price stabilize above key valuation support and hints that the market may be carving out a bottom, provided inflows stay positive.

Long-term holders continue to distribute coins in profit, but their realized margins are shrinking, further reinforcing the 2022 parallel.

Also Read: Ripple CEO Says Bitcoin Can Hit $180,000 By End Of 2026

Why It Matters: Off-chain signals point to cooling demand.

ETF flows have turned negative, showing institutional buyers stepping back, while spot CVD across major exchanges reflects persistent taker-side sell pressure.

Futures data underscores the caution: open interest is falling, leverage remains muted, and funding rates have reset to neutral — all signs that speculative longs have unwound and traders are avoiding aggressive positioning.

Options markets tell a similar story, with the brief spike in fear earlier this week quickly fading.

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