Bitcoin New Holders Need $98k Relief: A maturity squeeze in the making

Bitcoin short-term holders endure underwater positions, signaling considerable market pressure and investor pain.

Bitcoin's Relentless Grind: Why New Holders Need a $98K Lifeline, and What it Means for Your Portfolio in 2025

The crypto market, ever the demanding mistress, continues to test the resolve of its newest disciples. On-chain data is screaming a familiar, uncomfortable truth: Bitcoin's short-term holders (STHs) are deep underwater. This isn't just a temporary dip; it's a maturity squeeze in the making, and if history is any guide, it's a critical juncture for what comes next.

For those who bought into the narrative of endless rallies and easy gains, the last few months have been a harsh reality check. Bitcoin has stubbornly traded below the average cost basis of its most recent investors, extending an "underwater streak" that speaks volumes about current market dynamics. This isn't just about price; it's about the psychological and financial toll on the market's newest blood.

A critical Bitcoin price threshold is vital to alleviate significant unrealized losses for holders.

📌 The Relentless Grind: Bitcoin's Short-Term Holders Face Reality

💰 On-chain analytics firm Glassnode recently highlighted the stark situation for Bitcoin's short-term holders, a cohort defined as those who acquired their coins within the past 155 days. Their Net Unrealized Profit/Loss (NUPL) metric, which measures the aggregate unrealized profit or loss across the network normalized against market cap, has been decisively negative. In simpler terms, these recent buyers are collectively sitting on significant paper losses.

This group first dipped into negative territory back in November, a period marked by considerable volatility. While Bitcoin saw a modest recovery in December and January, it wasn't enough to lift the STHs back into profitability. Glassnode's analysis is stark: a sustained rally above approximately $98,000 is the minimum threshold required for this cohort to collectively break even. That's not just a price target; it's a psychological escape hatch.

The NUPL focuses on unrealized gains or losses – what investors are holding onto. But it's worth noting the realized picture too. Research from CryptoQuant's head of research, Julio Moreno, indicates that the 30-day value of Bitcoin's Net Realized Profit/Loss has also turned negative. This means actual loss-taking has outweighed profit-taking, a trend not seen since October 2023. This shift signals a more profound capitulation pressure, where investors aren't just holding losses, they're actively selling into them.

📌 Market Impact: A Test of Conviction or a Trap?

The sustained pain for short-term holders is more than just a data point; it's a critical determinant of short-term market trajectory and long-term market structure. In the immediate future, this pressure creates a ceiling. Any rally towards the STH cost basis around $98,000 will likely encounter significant selling pressure from those looking to exit at breakeven. This is classic supply dynamics: tired hands eager to dump at their entry price, limiting upside momentum.

Glassnode data confirms BTC short-term holders' Net Unrealized Profit/Loss shows consistent net losses.

⚖️ For the longer term, this "maturity squeeze" is a cleansing event. Weak hands, those who bought on hype without conviction, are gradually flushed out. This process, while painful for individuals, often forms the foundation for future bullish cycles. It reduces the overhead supply of impatient sellers, paving the way for more resilient price action once accumulation phases are complete. However, if Bitcoin fails to reclaim the $98,000 mark and remains range-bound or dips further, investor sentiment could turn decisively bearish, triggering a more prolonged period of consolidation and potential sector-wide contraction, affecting not just BTC but also altcoins, DeFi, and even the broader NFT market as capital dries up.

BTC Price Trend Last 7 Days

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The $98,000 threshold isn't merely a resistance level; it represents the collective hopes (and fears) of a significant portion of the current market. Its significance can hardly be overstated.

Key Market Indicators & Participants

Stakeholder	Position/Key Detail
Glassnode (On-chain Analytics)	Highlights Bitcoin STH NUPL negative, requiring ~$98K for breakeven.
CryptoQuant (On-chain Analytics)	Reports 30-day Net Realized Profit/Loss negative, loss-taking outweighs profit-taking.
Short-Term Holders (STHs)	👥 Bitcoin investors (last 155 days) currently holding net unrealized losses.
Bitcoin Price (Current)	💱 Trading around $90,900, indicating sustained pressure below STH cost basis.

📌 ⚖️ Stakeholder Analysis & Historical Parallel: The 2018 Bear Market Echoes

🐻 The current predicament for Bitcoin's short-term holders bears an uncanny resemblance to the aftermath of the 2018 Great Crypto Winter. Specifically, I'm referring to the prolonged pain from mid-2018 through late 2018 and early 2019. Back then, the euphoria of the late 2017 bull run had pulled in countless retail investors. When the market collapsed from its $20,000 peak, these "new holders" were left with staggering losses, their cost basis far above the prevailing market price.

🐻 The outcome of that period was a brutal, protracted bear market where STHs were forced into capitulation, often selling at significant losses or simply abandoning their positions. Bitcoin tumbled from over $19,000 in January 2018 to a trough below $3,200 in December 2018. The lesson learned was painful but clear: speculative excess leads to protracted cleansing. Only those with conviction or deep pockets to accumulate during despair survived and thrived in the subsequent bull run. This wasn't just a market correction; it was a transfer of wealth from impatient retail to patient, often institutional, hands.

In my view, this sustained underwater period for new holders is rarely an accident; it’s a necessary phase of market maturation, often strategically exploited by 'smart money' to accumulate at distressed prices. They thrive on retail pain, knowing that fear and frustration eventually lead to capitulation. What’s different today compared to 2018 is the sheer scale of institutional interest and the regulated pathways now in play (like spot ETFs). This might offer a more robust floor or different entry points for big players, but the core mechanics of human psychology, supply/demand, and the transfer of wealth from the weak to the strong, remain identical. The institutions are simply better positioned to take advantage of the predictable cycles of retail greed and fear.

📌 🔑 Key Takeaways

• Short-Term Holders Under Pressure: A significant portion of recent Bitcoin buyers are currently in net unrealized loss, creating a supply overhang.
• Critical Price Threshold: Bitcoin must reclaim and hold above $98,000 to alleviate the collective pain of these STHs and signal a healthier market.
• Market Cleansing Event: This prolonged underwater period acts as a shakeout for less committed investors, a necessary but painful phase for future market resilience.
• Historical Parallels Ring True: Current market dynamics echo the painful, protracted capitulation phases observed during past bear markets, highlighting recurring behavioral patterns.

📌 Future Outlook: The Road Ahead for Bitcoin's Retail Vanguard

🐻 The road ahead for Bitcoin's retail vanguard, especially those currently nursing losses, will be a test of endurance. If the $98,000 threshold isn't reclaimed relatively soon, we can anticipate a prolonged period of consolidation, or even further downside. This scenario would continue to squeeze out retail participants, ultimately creating a more "mature" supply profile dominated by conviction holders and institutional players. The market needs to shake off these weak hands before it can mount a sustainable recovery.

The entire Bitcoin network now reflects a net loss, as collective capital remains underwater.

💧 However, if Bitcoin does manage to break above $98,000 and hold, it could signal a significant shift in sentiment, potentially turning a critical resistance into support. This would re-energize market participants, drawing in fresh capital and potentially kicking off a new accumulation phase. Opportunities will arise for those with conviction and dry powder, particularly in projects demonstrating strong fundamentals and clear value propositions that can weather such market pressures. The regulatory environment, especially the evolving narrative around spot ETFs and broader institutional adoption, will also play a pivotal role in either reinforcing confidence or adding further layers of uncertainty, directly impacting how quickly liquidity returns to the market.

🔮 Thoughts & Predictions

The current Bitcoin market is a crucible, not a playground. Drawing parallels from the 2018 crypto winter, the ongoing pressure on short-term holders is a predictable, albeit painful, mechanism to redistribute wealth and solidify market foundations. It's a calculated shakeout. Expect significant volatility around the $98,000 mark, acting as a pivotal psychological and supply-side battleground for the next quarter.

From my perspective, institutional liquidity, now more pervasive than in 2018, is patiently waiting for retail capitulation to fully manifest. This creates a fascinating dynamic: while retail hopes for a quick bounce, smart money sees discounted accumulation opportunities. Should Bitcoin fail to reclaim $98,000, we could anticipate a prolonged consolidation phase, potentially pushing the next major bullish impetus into late 2025 or early 2026 as institutional players meticulously build their positions.

The takeaway is simple: this isn't about mere price action; it's about market structure evolution. The retail pain today is planting the seeds for the institutional gains of tomorrow, underscoring the enduring power dynamics within nascent asset classes.

🎯 Investor Action Tips

• Monitor STH Cost Basis: Keep a close eye on Bitcoin's price relative to the $98,000 threshold. A sustained break above this could signal renewed momentum; failure to do so implies further downside risk or extended consolidation.
• Allocate with Caution: If you're considering new entries, scale in gradually rather than making large, single purchases. This allows you to average down if prices dip further.
• Focus on Fundamentals: In periods of market stress, prioritize projects with strong fundamentals, proven utility, and clear roadmaps. Speculative assets will likely face continued pressure.
• Manage Risk Actively: Implement strict risk management strategies, including setting stop-loss orders and not over-leveraging positions, especially given the current volatility and potential for further downside.

📘 Glossary for Serious Investors

Short-Term Holder (STH): Bitcoin investors who have held their coins for less than 155 days. This cohort is typically more susceptible to market volatility.

BTC investor sentiment remains challenged, requiring substantial price recovery for true market relief.

Net Unrealized Profit/Loss (NUPL): An on-chain indicator that calculates the difference between unrealized profits and unrealized losses for a specific group of holders, normalized by market capitalization. A negative value means the group is collectively holding losses.

Cost Basis: The average price at which an asset was purchased. For STHs, the market trading below their cost basis indicates they are collectively at a loss.

🧭 Context of the Day

The sustained pain for Bitcoin's short-term holders is a critical market stress test that will determine the next phase of its price trajectory and investor sentiment.

📈 BITCOIN Market Trend Last 7 Days

Date	Price (USD)	7D Change
1/15/2026	$97,007.78	+0.00%
1/16/2026	$95,584.83	-1.47%
1/17/2026	$95,516.08	-1.54%
1/18/2026	$95,099.53	-1.97%
1/19/2026	$93,752.71	-3.36%
1/20/2026	$92,558.46	-4.59%
1/21/2026	$89,018.98	-8.24%

Data provided by CoinGecko Integration.

💬 Investment Wisdom

"The market is a device for transferring money from the impatient to the patient."
— Warren Buffett

Crypto Market Pulse

January 21, 2026, 03:12 UTC

Total Market Cap

$3.09 T ▼ -3.69% (24h)

Bitcoin Dominance (BTC)

57.51%

Ethereum Dominance (ETH)

11.57%

Total 24h Volume

$161.27 B

Data from CoinGecko

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