Bitcoin (BTC) Stuck in ‘Deep Value’ as Long-Term Holders Capitulate

Bitcoin (BTC) continues to grapple with a prolonged period of ‘deep value,’ trading below key investor cost bases for over five months. As of July 8, 2026, BTC is priced at $61,550, down 3.73% over the past 24 hours and significantly below its $75,476 cost basis for corporate treasuries like Strategy (formerly MicroStrategy).

According to Glassnode’s latest report, long-term holders (LTH) are driving the sell pressure, crystallizing losses at an unprecedented pace. LTH loss realization has climbed from 15% of total realized value in February to 43% today, with daily losses peaking at $280 million—a level not seen since December 2022. This trend highlights growing frustration among investors who bought near all-time highs and are now exiting as the bear market stretches beyond their conviction thresholds.

Key Metrics Signal Bottoming, But Not Yet a Rebound

Bitcoin spent the past week ranging between $58,300 and $64,400, showing short-term resilience but remaining far below two critical levels: the True Market Mean ($76,600) and the Short-Term Holder Cost Basis ($72,200). These thresholds have historically marked the transition from bear market lows to recovery phases. Until reclaimed, the $61,550 price keeps Bitcoin in structurally vulnerable territory.

At the macro level, ETF flows and institutional interest remain weak. Spot Bitcoin ETFs in the U.S. are recording net outflows of $88.9 million per day, a deceleration from the $193 million peak in early June but still negative. Trading volume, averaging $650–$950 million daily, is approximately 80% lower than October 2025’s peak of $4.4 billion, reflecting muted institutional confidence. Without a stabilization in flows and volume, a sustained recovery appears unlikely.

Derivatives Market Shows Mixed Sentiment

In the derivatives market, traders are cautiously shifting long. The put/call ratio has hit 0.56, its lowest level in 2026, indicating an uptick in demand for call options. Meanwhile, perpetual funding rates remain subdued, signaling that leverage is not overly skewed toward bullish positions. However, defensive hedging persists; the 25-delta skew remains bid across all tenors, showing that traders continue to price in downside risk.

Adding to this caution, Bitcoin’s current price is trading 6% below its max pain level of $66,000—where the most options contracts would expire worthless. While this discount has narrowed compared to extreme selloffs earlier in the year, it underscores the market’s ongoing defensiveness.

Macro and Institutional Overhangs

Externally, macroeconomic forces are a headwind. Despite a record $22.8 trillion U.S. M2 money supply, the Federal Reserve’s quantitative tightening has reduced its balance sheet by $2 trillion since 2023. This keeps real yields near 1%, elevating the opportunity cost of holding non-yielding assets like Bitcoin. At the same time, geopolitical events like the U.S.-Iran agreement lapse have added volatility, with Bitcoin struggling to decouple from broader risk assets like the S&P 500.

Institutional cost bases remain another area of pressure. Strategy’s recent sale of 3,588 BTC at $216 million—below its $75,476 cost basis—underscores the financial strain on corporate treasuries holding Bitcoin at elevated prices. This reinforces bearish sentiment, as leveraged holders capitulate.

What to Watch

For traders, the next key signals include: a sustained cooldown in LTH capitulation metrics, further compression in ETF outflows, and a reclaim of the True Market Mean at $76,600. Without these developments, Bitcoin’s bottoming process may continue to extend, keeping the market in a fragile state.

As it stands, Bitcoin’s price action, on-chain data, and institutional flows paint a picture of a market in the late stages of a bear cycle. However, the conditions for a credible transition to bullish momentum remain unmet, leaving traders to navigate a cautious and defensive environment.

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