Glassnode: Stablecoins See Fastest Contraction Since 2022 — Who Steps In After Long Leverage Flush?
Original Author: Glassnode
Original Compilation: Deep Tide TechFlow
Introduction: Recently, Bitcoin slid to around $74K, not only falling below the $75.6K short-term holder cost basis, but also significantly underperforming the S&P 500 and Nasdaq during the post-midterm election market rally. Over the past 30 days, the total stablecoin supply has contracted by $14.2 billion, marking the fastest shrinkage since June 2022.
Although U.S. spot ETFs have turned to net outflows and the Coinbase negative premium is under deep pressure, near-term long leverage on the spot market has been largely flushed out, and bid-side depth in the spot order book continues to outweigh ask-side selling pressure. The uptrend structure established since August remains intact above the $58.5K prior low, and two major whale wallet cohorts have already resumed accumulation.
Key Takeaways
• Bitcoin has fallen below the $75.6K Short-Term Holder Cost Basis and is underperforming U.S. equities, while incremental capital capable of driving prices higher continues to flow out.
• Total stablecoin supply is contracting at the fastest pace since June 2022, U.S. spot ETFs have turned to net selling, and Bitcoin is trading at a discount on Coinbase.
• On the other hand, this pullback has largely cleared out long leverage near the current price, bid-side thickness in the order book exceeds ask-side, and two large wallet cohorts have resumed accumulating coins.
• The September high this year was the first higher high since the 2025 all-time high. As long as the price holds above the June prior low of $58.5K, this medium-term trend reversal structure remains valid.
Recent Buyers Under Water
Last week we identified the $73K–$76K range as a key level to watch. Since then, Bitcoin has indeed slid into that zone and is trading around $74K, now below the $75.6K short-term holder cost basis—the average acquisition cost for investors who bought within the past 155 days.
At the September peak, nearly all short-term holder coins were in profit. As of now, that proportion has dropped to about 35%, and recent short-term sellers are on average realizing small losses.
The Cost Basis Distribution clearly reveals where these coins were acquired. Currently, about two-thirds of short-term coins sit above the current price, distributed across three dense cost bands formed between August and October, extending as high as $83.6K.
If the market rebounds, many of these underwater holders may use the opportunity to exit at break-even. Below the current price, the only dense cost support zone lies between $62K and $66K, primarily composed of buyers near the August swing low.
It is worth noting that the larger-degree market structure that began in August remains solid. The September high marked the first higher swing high since the 2025 all-time peak, and the current price remains well above the June prior low of $58.5K.
If the market can reclaim the True Market Mean at $77.5K, roughly half of short-term holder coins would return to profitable territory.
Underperforming U.S. Equities
Last week we noted that most of Bitcoin's decline during the midterm elections had already been released before voting. The subsequent new wave of selling that began on November 5 hit both U.S. equities and Bitcoin simultaneously.
But since November 9, the two have diverged. The S&P 500 and Nasdaq 100 have both recovered to their election-day closing levels, while Bitcoin fell again after the November 10 CPI data release and has cumulatively lost about 5% since.
Only when the price reclaims the election-day closing level of $77.8K can Bitcoin truly re-synchronize with the recovery pace of U.S. equities.
Treasuries Reflect More Rate Hike Expectations
The interest rate outlook also continues to pressure the market. The two-year Treasury yield reflects traders' expectations for the average Fed policy rate over the next two years. It currently sits at 4.75%, 75 basis points above the Fed's current benchmark rate of 4%, indicating the bond market is pricing in the possibility of further rate hikes.
But it must be noted that this is far from the severe tightening shock of 2022. In June 2022, the same spread surged to 244 basis points, while today's spread is only about one-third of that level and has narrowed somewhat since late October.
A higher rate environment remains a headwind for risk assets, but the bond market is not betting on a repeat of the 2022 tightening crisis.
Stablecoins Exiting at an Accelerating Pace
Stablecoins represent the crypto market's cash reserves—the dollar funds parked on exchanges and on-chain before traders deploy them to buy coins. Over the past 30 days, the total stablecoin supply across the network has shrunk by $14.2 billion, the fastest contraction since June 2022.
The continued contraction in supply means holders are redeeming stablecoins for fiat dollars and withdrawing cash directly from the crypto ecosystem, depriving any potential rally of its key "fuel."
Tether also reflects this outflow pressure, recently trading slightly below its $1 peg. If the 30-day supply change can turn positive again, that would be the first clear signal of new off-chain capital returning.
Weakening U.S. Market Demand
U.S. spot Bitcoin ETFs have also turned to net redemptions. Over the past 20 trading days, these funds recorded cumulative net outflows of $1.6 billion and breached the $1.5 billion threshold we use to define a "sustained outflow cycle" on November 9.
However, compared with historical ETF outflow cycles, the current exodus remains relatively shallow—most past outflow waves were far deeper than the current one. Based on historical patterns, ETF flows typically only turn to net inflows after Bitcoin has formed a阶段性 bottom, meaning capital return tends to be a lagging confirmation signal.
Coinbase Negative Premium Pronounced
The Coinbase Premium Index measures the spread between the Bitcoin price on Coinbase—the primary trading platform for U.S. investors—and the global composite price. We have removed the discount distortion caused by Tether trading slightly below its $1 peg to avoid inflating the visual magnitude of the negative premium.
On a 30-day average basis, the Coinbase premium has remained in negative territory throughout the decline from the September high, with the current discount depth at its lowest since February this year.
In every past rally cycle, aggressive buying by U.S. buyers pushed the premium into positive territory, while U.S. bid-side demand is notably absent at present. If the premium can turn positive and hold for several consecutive weeks going forward, it would signal that genuine U.S. domestic demand is returning.
Sparse Coins Near Current Price, Dense Liquidations Below
The liquidation heatmap measures the trigger zones where leveraged futures positions are forced into liquidation at various price levels. On the positive side, the gradual decline since the September high has cleared most of the long liquidation levels that had accumulated along the way—the dark vacuum areas behind the candlesticks illustrate this.
This greatly reduces the risk of cascading liquidation squeezes near the current price. On the six-month liquidation heatmap, the largest liquidation cluster sits far below between $59.5K and $62.6K, which has not been touched since the August bottom.
Between that cluster and the current market price, liquidation distribution is very thin. Meanwhile, despite the price having fallen about 15% from the September high, total open interest across the network has recovered to September-high levels, suggesting many traders have been adding short positions on the way down.
If the price turns upward, these newly added shorts would be forced to buy back to close; the largest short liquidation cluster above the current price currently sits near $87.5K.
Bid-Side Thickness Below Exceeds Ask-Side Pressure Above
The spot order book presents a similarly bullish support structure. Since the November 5 sell-off, bid orders within 5% of the current price on Binance and Coinbase have exceeded ask orders in every hourly period.
The brackets below the heatmap mark the most concentrated bid regions, primarily distributed between $68K and $72.5K. The upper brackets present the opposite picture: after a thin band of sell orders immediately above the current price, the entire ask-side order book remains extremely sparse up to about $84K, corresponding to the dark vacuum band in the chart.
This means that if the price breaks upward, resistance from the order book itself is not significant, though it will still need to absorb selling pressure from short-term holders looking to exit at break-even. It should also be noted that limit orders can be cancelled at any time—in fact, during the early November crash, some support bids were briefly pulled before being re-listed.
Large Holder Wallets Beginning to Step In
The Accumulation Trend Score tracks the position changes of wallet cohorts by holding size (near 1 indicates active accumulation, near 0 indicates distribution), weighted by holdings.
Over the past week, two wallet cohorts saw their scores rise above 0.5: wallets holding 100 to 1,000 BTC and wallets holding 1,000 to 10,000 BTC. Both cohorts had been in distribution mode for most of October.
It is worth noting, however, that these two large-holder cohorts also briefly turned to buying in late September, but failed to sustain it at the time. Apart from these, all other holding cohorts continue to reduce positions—from super whales holding over 10,000 BTC down to retail wallets holding less than 1 BTC.
This appears to be only an early, tentative bottom-fishing effort by a small subset of capital. Only when mid- and small-sized holding cohorts follow suit would it constitute a full recovery of buying power across the entire market.
Conclusion
Bitcoin is undergoing a pullback in an environment lacking incremental capital support: recent buyers are broadly underwater, performance is significantly trailing U.S. equities, and capital is draining simultaneously from three dimensions—stablecoins, U.S. spot ETFs, and U.S. domestic buying. Near-term direct bullish catalysts are indeed scarce.
On the other hand, futures long leverage around the current price has been effectively flushed out, and two major large-holder cohorts have already stepped in to buy. For investors who view August this year as the starting point of a major cycle trend reversal, the current window is a key zone where the market is building toward mean reversion.
If the market can successfully reclaim the $75.6K short-term holder cost basis, it would strongly confirm this bullish thesis. Conversely, a sustained break below last week's watch-zone lower bound of $73K would imply a longer period of range-bound consolidation; a decisive close below the June prior low of $58.5K would completely invalidate the reversal trend established in August.
Data cutoff: Price and derivatives data as of 11:00 UTC on November 11, 2026; spot order book data as of 09:00; ETF flows, stablecoin supply, cost basis, and Accumulation Trend Score as of November 9.
Disclaimer: This report does not constitute any investment advice. All data is for informational and research purposes only. No investment decision should be based directly on the content of this article; readers bear full responsibility for their own trading activities.
Exchange balance data referenced herein is calculated based on Glassnode's address label database, which combines official disclosures with proprietary clustering algorithms. While we strive for rigor and precision, in cases where some exchanges do not disclose official addresses, the relevant statistics may not cover their entire reserves.
Users should exercise caution and independent judgment when using the above on-chain metrics. Glassnode assumes no responsibility for any differences in statistical methodology or potential errors.
