With Bitcoin falling roughly 45% from its all-time high and derivatives funding deeply negative for weeks, knowing how people feel about the market matters less than knowing what they really are doing. The Bitcoin Impact Index is built around this question: it tracks which groups of holders are under real financial stress, how severe that stress is, and whether it is large enough to drive the next move.
It is based on three blocks: on-chain holder behavior (which cohorts are moving coins and with what gains or losses), ETF and derivatives activity (institutional flows, settlements, funding rates, and settlement directionality), and exchange-level liquidity (BTC inflows, stablecoin flows, and realized loss density). The index is updated weekly, on a scale from 0 to 100, with the following bands:
- Normal rotation (0-24): routine profit taking, no structural change.
- High repositioning (25-49): significant cohort changes, limited institutional stress.
- High impact (50–74): LTH and STH both under pressure, de-risking on ETFs/derivatives.
- Critical Impact (75-100): LTH capitulation, large ETF outflows, major liquidations, strong currency inflows.
Below are the readings for the full 10 weeks of 2026, followed by what the latest data suggests about the current situation.
The lowest index reading in 2026 was 28.8 in mid-January, when ETF inflows were strong and holder stress was easing. A week later, a sharp sell-off began, illustrating an important point about how to read the index. The overall score reflects what has already happened, but the signals it contains can indicate where pressure is building before it is fully reflected in the price.. The highest reading was 69.7 in early February, when long-term holders were selling at a loss, ETFs were bleeding capital and liquidations peaked. Current readings fall roughly in the middle of that range.
*Note: The figures for Week 11 are partial because the week is not over yet.
Week 11 (March 9-15): A fragile recovery
The index opens the new week in 44.8continuing in High Repositioning and moving further away from the High Impact threshold compared to last week 49.4. This continues a broader trend of gradual easing. Although the direction is positive, the improvement is uneven across different parts of the market.
Short-term pressure eases, but long-term holders are the new concern
Short-term holders have reduced loss-selling, with their realized P/L ratio recovering close to the breakeven point. However, long-term holders moved in the opposite direction. LTH SOPR fell to 0.762, the lowest reading in three years. Long-term holders typically allocate coins during strong rallies, when they can lock in profits. When they instead sell at a loss, it generally reflects a weaker conviction of higher profits.
At the same time, the picture of short-term holders can change quickly. Last week, as Bitcoin approached $74,000, SOMETHING SURPRISED it briefly reached 1, and many short-term holders took advantage of that moment to exit positions at the break-even point rather than holding them for further gains. Now the market faces a similar test again. With STH SOPR back at 1 and Bitcoin trading close to $70,000The key question is whether short-term holders will treat this level as another exit opportunity. If they do, it would suggest that confidence in a sustained recovery remains limited.
Liquidity Signals Send Mixed Messages
Despite the improvement in short-term holder behavior, the liquidity picture moved markedly in the wrong direction. Stablecoin Flows Towards Exchanges turned deeply negative with a daily average of –$187.9 million, reversing the positive readings of the last two weeks. BTC Input Swap remained low, which is positive, but the stablecoin reversal suggests that the buyer interest seen in early March has not yet turned into a steady buildup.
Positioning in derivatives remains deeply negative
Financing rates remain negative at -0.0044, meaning that leveraged traders continue to pay a premium for holding short positions. This signal has persisted for over a month without a decisive resolution, and this week brought no significant change in either direction. The divergence between improving spot conditions and persistently bearish derivatives positioning remains the unresolved tension that defines the market.
However, it is worth putting this in context. Although the current positioning in derivatives appears similar to that of early February, the most intense period of 2026, the tension in the spot market is much less. Historically, that divergence preceded sharp moves in either direction. Episodes of extremely negative financing without corresponding spot impairment have sometimes resolved as short squeezes, in which short positions are forced to cover and prices rise sharply. But that outcome requires sustained spot purchases to hold firm, which stablecoin data has yet to confirm.
What could happen next?
At this point, the most likely outcome is a continued price decline or a sideways move. The key thing to watch is whether short-term holders sell again as they break even, as they did near $74,000 last week. If that happens again, it means that each price bounce is being used as an exit opportunity, not a reason to hold. Add to this the deteriorating conviction of long-term holders, the flight of stablecoins and persistently negative funding rates, and the pressure is firmly pointed downwards.
For the outlook to really improve, the long-term fork SOPR would have to stop falling and recover above 1, confirming that veteran sellers are burning out rather than accelerating. Stablecoin inflows would have to return steadily, and short-term holders would have to hold to breakeven rather than selling it. At this moment, none of those conditions exist. Until they do, any price recovery is more likely to stall than sustain.
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