Crypto Winter: 50%+ of Bitcoin Addresses Now in the Red

According to a recent report from Coindesk, more than 50 percent of Bitcoin addresses are now in the red for the first time since the start of the coronavirus-induced crash of March 2020.

Coindesk reports that most cryptocurrency addresses holding Bitcoin are now in the red for the first time since the coronavirus-induced crypto market crash of March 2020.

The Blockchain analytics firm IntoTheBlock says that just over 51 percent, or 24.6 million of the total 47.9 million addresses, are currently valued below their investment cost. Approximately 45 percent of addresses are said to have unrealized gains, while the rest are approximately breaking-even on their investment.

A bitcoin address whose coins were acquired at an average price higher than bitcoin’s going market rate of $16,067 is considered out-of-the-money. Lucas Outumuro, the head of research at IntoTheBlock stated that the bearish momentum of the market looks overdone. Previous bear markets ended with the majority of addresses also being out-of-the money.

55 percent of addresses were out of the money in January 2019, when bitcoin bottomed near $3,200 and began a bull run three months later. During the 2015 bear market, 62 percent of addresses were out of money.

Crypto has faced a rough time since the collapse of FTX, the popular crypto exchange that it seems almost all major crypto firms had large amounts of money invested with. Cryptocurrency lending firm Genesis Global Capital has reportedly asked crypto exchange Binance and private equity firm Apollo Global Management for cash. Genesis is faltering as the FTX contagion continues to spread throughout the cryptocurrency world.

Genesis isn’t the only crypto firm facing troubles following the collapse of FTX. Breitbart News previously reported that BlockFi, a platform for crypto-backed loans and trading, may also be facing bankruptcy due to its exposure to the FTX contagion.

In a blog post, BlockFi admitted to “significant exposure” to FTX and Alameda Research, the crypto exchange and trading company operated by Sam Bankman-Fried, including loans to Alameda. BlockFi also sought to reassure observers that it has the “necessary liquidity to explore all options.”