Bitcoin’s slide toward a key on-chain support level has sparked debate after market analyst Shanaka Anslem Perera argued that the behavior usually seen at major market bottoms is still missing.

According to him, BTC came within 9% of the price level that has historically ended bear markets, but investors didn’t sell in the numbers usually associated with capitulation.

Bitcoin Nears Realized Price, But Selling Pressure Looks Different

The metric in question is Bitcoin’s realized price, which is currently around $53,600, and represents the average cost basis across every BTC in circulation.

In a June 11 post on X, Perera stated that in 2018 and 2022, the OG cryptocurrency fell to that level and bounced. Those rebounds, according to him, weren’t coincidences but were because of what happens after Bitcoin comes close to its realized price. Holders often break, selling at a loss in large enough numbers that the supply gets flushed, weak hands leave, and the market finds solid ground again.

But that flush hasn’t happened this time around. In the 2022 capitulation, Perera says holders sold 1.2 million BTC at a loss, but in last week’s drop, the number was only 187,000 units.

Essentially, Bitcoin approached the same price floor without the same behavior, which, per the analyst, is precisely what made that moment ambiguous rather than confirming.

“Bitcoin reached the bottom’s address without the bottom’s behavior,” he wrote. “The flush that clears weak hands and ends bear markets has not happened.”

In his opinion, the dip was driven by disappearing demand rather than panic selling. He pointed to a drop of 652,000 BTC in demand last week, which he described as the worst decline since January 2022, and also noted that spot Bitcoin ETF flows had been hugely negative.

Bitcoin’s cause has not been helped by escalating geopolitical tensions after Iran once again closed the Strait of Hormuz following US strikes on its military infrastructure, sending the price of crude oil jumping by more than 2.5%.

Furthermore, the US Consumer Price Index came in at a higher-than-expected 4.2%, effectively ruling out Fed rate cuts and raising the possibility of hikes under the new Federal Reserve Chair, which added to concerns about reduced market liquidity.

Long-Term Holders Still Steady Despite Market Pressure

One other thing that Perera pointed out in his assessment was that the lack of selling can also be interpreted as a bullish signal.

“The realized price has marked four of the last four major bottoms, and long-term holders are sitting still rather than selling. That is the bull case,” he explained.

That view echoes comments from another market observer, Sykodelic, who noted that long-term holders collectively control a record 16.5 million BTC despite many positions sitting below the prices they were bought for.

Other firms have reached similar conclusions while stopping short of calling a bottom. For instance, Grayscale has said that Bitcoin currently looks undervalued, even though it warned that the conditions right now are not as extreme as past bear market lows.