Recent on-chain data shows a significant shift in the Ethereum market condition: about 40% of circulating Ethereum (ETH) is currently at a loss. This is reflected in a sharp drop in the share of profitable supply — from roughly 75% earlier this month down to 59%, according to Glassnode. Understanding the reasons and distribution of these losses helps assess market sentiment and possible future scenarios.
Why Is 40% of ETH at a Loss?
According to Glassnode, the share of profitable ETH supply has fallen to 59% from about 75% earlier this month, meaning four out of ten tokens in circulation are now worth less than their purchase price. The main driver is ETH's price weakness, which has pushed many positions below investors' entry points. Most losses are concentrated among medium-term holders who bought near recent peaks and are now at a loss.
- Glassnode data: profitable supply dropped from ~75% to 59%.
- ETH price fell below key levels where many investors entered.
- Majority of losses are with medium-term holders; long-term holders remain mostly profitable.
What Do On-Chain Data Say About ETH’s Position?
On-chain analytics reveal not only the distribution of profits and losses but also the structure of holders. ETH’s current price is $2,970.41, showing a modest daily gain of 1.52%, yet it remains noticeably below recent highs. Maintaining price above certain levels will be crucial to prevent further supply moving into loss, so monitoring price dynamics and position distribution is important.
If you want a deeper understanding of the factors behind the decline, read our article on the Ethereum price drop, which analyzes key drivers and market implications.
Comparison with Previous Market Cycles
The 40% loss supply figure is significant but not unprecedented: during severe bear phases, the share of ETH at a loss exceeded 60%. Historical comparisons show the current situation lies between normal fluctuations and extreme capitulation. This provides context for assessing risks and potential points of renewed investor interest.
For an example of how large unrealized losses impact the market, see the analysis of LD Capital losses, illustrating how large positions affect the overall picture.
What Should Ethereum Investors Consider?
ETH holders should maintain a strategic approach and avoid emotional reactions during periods when a significant portion of supply is at a loss. Focus on the network’s fundamental factors, holder distribution, and your investment horizon when making decisions. For those with short-term goals, the current market structure carries increased risks, while long-term holders may view this as an averaging opportunity.
- Strategic mindset: avoid emotional sell-offs amid paper losses.
- Fundamentals: consider network development and technology adoption metrics.
- Opportunities for long-term investors: consider averaging in if aligned with your plan.
Why This Matters (For Miners with 1–1000 Devices in Russia)
Even if current data doesn’t directly change mining technical conditions, it affects profitability in fiat rubles through ETH’s price. Price declines and rising loss supply can reduce revenue from selling mined coins, especially if you sell regularly to cover electricity and maintenance costs. Understanding how price and on-chain distribution impact your operating margin is crucial.
Additionally, shifts in market sentiment can influence liquidity and holders’ willingness to sell, collectively affecting price volatility. For miners, this means planning budgets and buffers to cover periods of lower prices.
What to Do? Practical Recommendations for Miners
If you operate between one and a thousand machines, it’s helpful to have a clear action plan for prolonged price drops and increasing loss supply. Small adjustments in revenue and expense management can reduce the risk of vulnerability. Below are specific steps you can apply soon.
- Monitor ETH price and on-chain metrics (like Glassnode) at least weekly to track changes in profitable supply share.
- Optimize sales: consider accumulating mined coins during price dips or applying averaging if it fits your financial plan.
- Reduce operating costs: review electricity tariffs, equipment efficiency, and operating modes to lower mining costs.
- Keep records and plan buffers: calculate breakeven points and maintain reserves to cover expenses during low-price periods.
Frequently Asked Questions
What does it mean when ETH is at a loss? It means the current market price is below the purchase price for holders, so selling now would realize a loss. This status is reflected in the distribution of acquisition prices by addresses on the blockchain.
How is the percentage of ETH at a loss calculated? Analytics services compare historical purchase prices of coins with the current price; the share of coins whose current price is below acquisition price determines the loss percentage. Glassnode is one such data provider.
Should I sell ETH if it’s at a loss? The decision depends on your goals, time horizon, and risk tolerance. Many investors view periods with a large share of supply at a loss as averaging opportunities, but the approach should align with your personal strategy.
How long does ETH usually stay at a loss? Historically, this varies: some periods last weeks, others months. In severe bear markets, the share of losing coins exceeded 60%, showing a wide range of possible scenarios.