Bitcoin is recovering from a “black swan” event last rivaled by the March 2020 COVID-19 crash, data suggests.
In one of its Quicktake posts on Sept. 7, on-chain analytics platform CryptoQuant revealed a major spike in loss-making unspent transaction outputs (UTXOs).
CryptoQuant: Bitcoin UTXOs in loss “mirror” March 2020
Bitcoin may be worrying market participants with current BTC price weakness, but on-chain data paints an intriguing picture of activity “under the hood.”
UTXOs represent BTC left over after an on-chain transaction is executed. CryptoQuant’s UTXOs in Loss metric tracks when large numbers of these UTXOs are worth more than they were when the BTC was originally bought.
Currently, more of these are in loss compared to their original acquisition price than at any time since March 2020.
At the time, BTC/USD dropped 60% to its lowest levels since March 2019 — lows which were never seen again.
Considering the current data from UTXOs in Loss, CryptoQuant contributor Woominkyu ventured that, like March 2020, Bitcoin may be seeing, or already bouncing back from, a curveball selling event.
He summarized:
“Given that the current level of the ‘UTXOs in loss’ indicator mirrors that of the Black Swan event between March and April 2020 (due to the Coronavirus), those anticipating another Black Swan event might want to consider whether we are already in the midst of the event they are waiting for.”
