On-chain analytics firm Glassnode reports that Bitcoin liquidity has sharply declined alongside recent market weakness, especially among short-term holders (STHs).

Short-Term Holder (STH) Liquidity Collapse

• Glassnode uses the Realized Profit/Loss (P/L) Ratio to measure BTC market liquidity.
• The STH Realized P/L Ratio, which tracks investors who bought BTC within the last 155 days, has plunged to 0.07, signaling that recent buyers are mostly selling at a loss.
• Such a low value indicates that liquidity in the short-term market has evaporated, following heavy demand absorption in Q2–Q3 2025.
• Previous similar lows occurred in Q1 2022, though the current weakness is less prolonged.

Long-Term Holder (LTH) Liquidity Remains Healthy

• LTHs, holding BTC for over 155 days, are still largely profitable.
• The 7-day EMA of the LTH Realized P/L Ratio has declined but remains extremely high at 408, meaning long-term holders are realizing 408 times more profit than loss.
• Compared to prior market cycles, long-term liquidity is still robust, providing a stabilizing influence on the market.

Implications

• Glassnode warns that if LTH liquidity declines further and the ratio compresses toward 10x or lower, a deeper bear market may become likely.
• Short-term capitulation has removed much near-term buying power, setting up a critical test for BTC at current price levels.

Current Bitcoin Price

• BTC is trading around $90,600, down 1.3% over the past week.

Summary: While short-term liquidity has collapsed, long-term holders still maintain a strong profit buffer. The market is in a precarious state: continued LTH spending or liquidity reduction could signal a transition into a deeper bear market.