More Bitcoin Is Held at a Loss Than in Profit for the First Time

More bitcoin was sitting on a paper loss than on a paper gain on July 3, the first time the two had crossed over in this cycle. On-chain data cited by CoinDesk put 10.83 million BTC held below the price at which those coins last changed hands, against 9.22 million held above it. Bitcoin itself traded in a narrow band between $61,361 and $62,170 on the day, up 0.75% and 2.5% on the week, leaving it roughly 51% below the October 2025 all-time high of $126,080. The crossover is a measure of where holders stand rather than a prediction of what they will do, but it is the kind of threshold that only gets crossed after a long decline.

The Measure: Every Coin Priced at Its Last Move

Supply in profit and supply in loss are derived from the bitcoin ledger itself, which records not just balances but the moment each unit of the supply last moved. Analysts take the market price at that moment as the coin's cost basis, then compare it with the current price: if the coin last moved above today's price it counts as supply in loss, and if it moved below, as supply in profit. Summed across the whole ledger, the two figures partition the circulating supply into holders who are underwater and holders who are not. The method is mechanical and requires no survey data, which is why it is reported so widely.

It is also an approximation, and the caveats matter. A coin's last on-chain movement is not necessarily a purchase — a transfer between two wallets belonging to the same owner resets the cost basis just as a trade does, and coins held on exchanges move on the exchange's internal ledger rather than the blockchain, so their real cost bases are invisible. Long-dormant supply, including coins whose keys are lost, is counted at prices that no longer mean anything. The crossover is best read as a broad sentiment gauge, not an inventory of who is actually nursing a loss.

The Path Here: From $126,080 to the Low $60,000s

The distance from the October 2025 peak explains most of the arithmetic. A drawdown of roughly 51% puts every coin bought above the low $60,000s into the loss column, which after two quarters of decline covers a large share of the supply that has moved at all recently. The selloff deepened through the second quarter and into a 21-month low in June, then extended to the cycle low set on July 1 before the market steadied. By July 3 bitcoin had recovered into the low $62,000s, but not far enough to move a meaningful quantity of supply back above water, and the ratio stayed inverted.

The Level Traders Watch: A 200-Week Average at $62,660

Just above the day's range sat the 200-week moving average, the mean closing price of the past four years, which stood at $62,660. Traders give that line more weight than most technical levels in bitcoin because its four-year window makes it slow to whipsaw, and because it has been cited repeatedly through this drawdown as the level bitcoin was approaching from above. Bitcoin spent July 3 immediately beneath it. CoinDesk flagged $67,000 as the first level that would begin to challenge the downtrend, and May's local high of $81,000 as the level needed to reverse it.

What Is Unresolved: Whether the Crossover Reverses or Deepens

Because the measure depends entirely on price, the supply ratio can invert again quickly: a move back through the low $60,000s would return a large block of coins to profit without anything else changing. The more consequential question is what the holders in the loss column do while they wait, since a supply base that is broadly underwater tends to produce selling into strength as positions are closed at break-even. Neither the crossover nor the 200-week average settles that. What they establish is the reference points the market is now trading against.