Supply at a loss refers to the amount of a digital asset currently held by investors at an unrealized loss, meaning their acquisition price was higher than the current market price. This metric indicates the collective sentiment and potential selling pressure from holders who might liquidate their positions to minimize further losses. A large supply at a loss can suggest market capitulation or a potential for strong resistance during recovery. It measures investor pain.
Context
Supply at a loss is a significant on-chain metric frequently analyzed in crypto news to gauge market sentiment and identify potential bottom formations. Discussions often focus on the percentage of circulating supply held underwater, which can indicate the proximity to a market reversal or continued downward pressure. Understanding this metric provides immediate, actionable context for assessing the psychological state of the market and anticipating future price movements.
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