Bitcoin’s Weak Hands Are Folding – But Is One Final Flush Still Ahead?

Bitcoin traded in a tight range around $64,500 as investors remained cautious following the Federal Reserve’s hawkish hold, while ongoing US-Iran tensions kept risk sentiment in check.

Against this backdrop, a key BTC on-chain metric has fallen 62% in the past nine months.

Short-Term Holders Are Cracking

Crypto analyst Darkfost said short-term Bitcoin holders (STHs) continue to realize losses, as cumulative losses are becoming increasingly significant. In the latest note, the analyst found that STHs’ realized capitalization has declined by nearly 62% from its October 2025 peak.

According to Darkfost, the drop reflects typical behavior seen among short-term holders during market corrections. This includes extreme capitulation, which removes UTXOs created at much higher prices, as well as continued accumulation during the correction, which creates new UTXOs at lower prices. This process mechanically reduces the realized capitalization of the STH cohort.

The findings also reveal that previous bear markets recorded drawdowns of 70% to 75% in this metric. While the current levels are approaching that range, it remains uncertain whether the market will continue consolidating or enter a final correction phase.

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