Bitcoin falls to $83,000 and faces an increase in underside pressure in the “air gap” zone

Bitcoin (BTC) prices have collapsed to $83,223.04 after a 6.5% revision over the past 24 hours.

According to a recent GlassNode report, BTC is currently trading in a low-fluid “air gap” zone between $70,000 and $88,00. He added that the lack of demand increases the risk of further downsides.

The report linked negative side pressures to the market-wide sales with the impact of Buybit Hacks. The Cost-Based Distribution (CBD) heatmap reveals significant reductions in realized supply between $70,000 and $88,000 due to rapid price increases that overtaked capital inflows.

Market weakness and investor stress

As Bitcoin surged to a new high, long-term holders began distributing supply and began to weaken momentum. The subsequent market decline, exacerbated by the Buybit Hack, pushed Bitcoin prices back into a non-burning zone.

When Bitcoin drops into the $83,000 zone, it puts pressure on investors, as shown in the short-term holder market value of 0.95 (STH-MVRV) ratio. This metric suggests that on average, recent buyers hold positions at around 5% loss compared to cost basis.

The adjusted STH-MVRV is down 15.8% from the quarter median, indicating a violation of one standard deviation threshold (-11%). Historically, such levels have preceded contraction events or forced liquidation. Unrealized losses have led investors to sell at lower prices, and the market is declining.

This report has been changed to Short-Term Holder Usage Output Return Rate (STH-SOPR) to assess new investor sentiment. This ratio measures whether a recent buyer is selling profits or losses.

STH-SOPR is down -0.04 from the quarter median, significantly below one standard deviation threshold (-0.01). This reflects an increase in realisation of losses, with many short-term holders closing their positions with losses.

The sharp SOPR contraction resulted in temporary stabilization as weaker hands emerged, suggesting that further reductions are possible unless strong demand emerged.

Bybit Hack

As the Buybit Hack unfolded, market volatility intensified, causing a wider economic recession. Lower liquidity and weaker spot demand contributed to sales pressure and led to an extension of market revisions.

Bitcoin’s monthly momentum fell by -13.6%, while other major ciphers have experienced an even more sharp decline. Ethereum fell by 22.9%, Solana fell by 40%, and Meme Coin Index fell by 36.9%, highlighting the risk-off sentiment that is common in the market.

This sharp recession has reversed the momentum of rising prices over the next few months, bringing Bitcoin back to the level it last saw in November 2024.

The report said demand catalysts and liquidity conditions determine the possibility of recovery or continuing risk of drawbacks as the market is seeking stability.

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