Recent data from Glassnode indicated that Bitcoin (BTC), Ether (ETH), and Solana (SOL) are experiencing record high levels of their supply held at a loss. However, a deeper analysis of the locked supply, institutional holdings, and staking structures reveals that the effective liquid supply under pressure is considerably lower than these percentages suggest, particularly for Ether and Solana.
Key observations include:
- •A significant portion of Ether and SOL held at a loss is not readily liquid. Over 40% of ETH and more than 75% of SOL are locked in staking, ETFs, or strategic reserves.
- •While Bitcoin's supply held at a loss appears high, institutional holdings and estimates of lost BTC substantially reduce its truly liquid float.
Positions at a Loss Do Not Reflect Actual Liquid Supply
Bitcoin currently has 35% of its supply held at a loss, a level last observed when BTC traded around $27,000. Even without a native staking mechanism, Bitcoin's liquid supply is significantly lower than these figures imply. The relevant statistics are as follows:
- •BTC circulating supply: 19,953,406
- •BTC held by public and private companies, ETFs, and countries: 3,725,013 BTC
- •Estimated BTC lost forever: 3,000,000–3,800,000 BTC, representing 15.0% to 19.0% of the total circulating supply.
Collectively, these factors remove approximately 33% of all Bitcoin from liquid circulation. Institutional holdings, especially those in ETF treasuries and corporate treasuries, are generally insensitive to short-term volatility due to mandates tied to reserves, long-term accumulation strategies, or index tracking. The amount of lost BTC further diminishes the supply that can react to loss-driven selling pressure.
Ether's Supply Dynamics Require Nuanced Interpretation
Ether's figures necessitate a more detailed examination. Although 37% of ETH is currently held at a loss, a substantial portion of the network's supply is locked or held by institutions:
- •ETH circulating supply: 120,695,601
- •ETH staked: 35,681,209 ETH (approximately 29.6%)
- •ETH in spot ETFs: 6.26 million ETH (approximately 5.18%)
- •ETH in strategic reserves (SER): 6.36 million ETH (approximately 5.26%)
In total, over 40% of all ETH is effectively locked in staking, ETFs, or long-term institutional reserves. These categories historically do not react to short-term price swings, as institutional products like ETFs and custodial reserves operate under policies that prioritize long-term accumulation over discretionary selling. Consequently, the actual liquid ETH supply facing loss-driven pressure is materially smaller than the previously mentioned 37%.
Solana Shows Significant Divergence in Supply Metrics
Solana exhibits an even more pronounced divergence. Despite 70% of circulating SOL being held at a loss, the network boasts one of the highest staking ratios among major blockchains:
- •SOL circulating supply: 559,262,268
- •SOL staked: 411,395,790.5 SOL (73.6%)
- •SOL in ETFs: approximately 1% of circulating supply
This indicates that more than three-quarters of all SOL is locked in validator staking or institutional products, neither of which demonstrates rapid selling behavior. It is noteworthy that when SOL prices fell to $121, the supply held at a loss widened to 80%, a level previously reached near $20. This illustrates the metric's sensitivity to rapid price adjustments rather than widespread structural capitulation.
Interestingly, for both ETH and SOL, the supply-at-loss metrics tend to decrease sharply during uptrends due to their significant staking locks. This makes such spikes more indicative of price velocity rather than panic positioning.
In summary, across all three assets, the raw percentages of supply held at a loss tend to overstate potential sell pressure. Once locked supply, institutional holdings, and permanently lost coins are factored in, the true liquid supply at risk is considerably more contained.