Bitcoin outflows slow as on-chain data shows signs of recovery, Glassnode reports

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Bitcoin outflows slow as on-chain data shows signs of recovery, Glassnode reports

Bitcoin’s network outflows are showing signs of slowing, suggesting that the selling pressure that has weighed on the market in recent months may be easing. According to data from on-chain analytics firm Glassnode, the cryptocurrency’s Realized Cap — a metric that measures the total cost base of all coins moved on-chain — has declined by 1.45% over the past 90 days. However, this rate of decline has slowed sharply over the past seven days to just 0.18%, indicating a potential stabilization in investor behavior.

Market liquidity improves as sell orders decrease

The slowdown in outflows coincides with improving market liquidity conditions. Glassnode’s analysis reveals that buy orders on the Binance spot order book have begun to exceed sell orders, a shift that could indicate growing demand at current price levels. This reversal in order book dynamics is often interpreted by traders as a short-term bullish signal, especially when accompanied by falling exchange rate inflows.

Despite these encouraging on-chain signals, Bitcoin remains under significant price pressure. The asset is currently trading around 15% below its on-chain fair value, which Glassnode calculates using the True Market Mean metric – a valuation model that determines the price at which each coin in the chain last moved. That fair value stands at $77,200, suggesting that Bitcoin’s current market price is well below what chain data implies as a balanced valuation.

Short-term holders remain underwater

Adding to the cautious outlook, Bitcoin’s price is also trading below the average on-chain purchase price for short-term holders, which Glassnode reports at $72,600. This group, typically defined as addresses that have held coins for less than 155 days, are now sitting on unrealized losses. Historically, such conditions have often preceded periods of accumulation or capitulation, depending on broader market sentiment.

The difference between improving fundamentals in the chain and persistent price weakness has become a central theme in recent market commentary. While metrics such as delayed outflows and strengthening bid-side liquidity point to a possible bottoming process, the price has yet to confirm a reversal.

What this means for investors

For market participants, the Glassnode data presents a nuanced picture. On the one hand, the slowdown in Realized Cap declines and the improvement in order book composition are signs that the worst of the selloff may be behind the market. On the other hand, Bitcoin’s continued discount to its fair value on the chain and the underwater position of short-term holders suggest that a full recovery may take time.

Investors should also note that on-chain statistics are lagging indicators – they reflect past transactions and aggregated behavior. While they provide valuable context for assessing market health, they do not predict short-term price movements with certainty.

Deduction

Glassnode’s latest data paints a cautiously optimistic picture for Bitcoin. The slowing pace of outflows and improving liquidity conditions are positive signals, but the price remains below key-on-chain valuation levels. The coming weeks will be critical in determining whether these early signs of recovery translate into sustained upward momentum or if the market needs further consolidation.

Frequently Asked Questions

Q1: What is Bitcoin’s Realized Cap and why does it matter? Realized Cap is an on-chain metric that values ​​each Bitcoin at the price it last moved, rather than the current market price. It provides a more accurate picture of the total investor cost basis and is used to determine whether the market is over or undervalued.

Q2: What is the True Market Average price? The True Market Average is a valuation model developed by Glassnode that calculates the average price at which all coins in circulation last moved on the chain. It is considered a measure of Bitcoin’s on-chain fair value.

Q3: Why are short-term holder prices important? The average purchase price of short-term holders (coins held for less than 155 days) acts as a psychological support or resistance level. When Bitcoin trades below this price, many recent buyers are at a loss, which can lead to selling pressure or accumulation depending on sentiment.

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