87% of Bitcoin holders are in profit despite the drop!

A new analysis by Glassnode reveals a surprising statistic: 87% of Bitcoins in circulation are in profit. This data, contrasting with the stagnation of BTC prices in recent weeks, offers an intriguing insight into the current market state and its prospects. Why this relative stability, and what could be the implications for the future of this leading crypto in the market?

Bitcoin in profit despite price stagnation

According to a report by Glassnode, 87% of the Bitcoin supply is currently in profit. This situation persists despite the restricted price movements of the crypto in recent weeks. At the time of writing, Bitcoin is trading at $65,436, moving in a horizontal channel with resistance at $71,656 and support at $64,825. “BTC prices are consolidating within a well-established range. Investors remain overall in a favorable position, with more than 87% of the circulating supply in profit, with a break-even point below the spot price“, indicates Glassnode.

The Market Value to Realized Value (MVRV) ratio of Bitcoin shows that the average circulating BTC holds an unrealized profit of more than 120%. However, despite this profitability, the volume of coins processed and transferred on the Bitcoin network has significantly decreased since the historical peak in March. Glassnode notes that this drop “highlights a reduced appetite for speculation and increased market indecision“.

The decline in exchange flows and future implications

The consolidation of the BTC price has also led to a decrease in the exchange flows of Bitcoin. Glassnode reports that short-term holders (STHs) are currently sending about 17,400 BTC (valued at $1.13 billion at current market prices) to exchanges each day, a drop of 68% compared to the 55,000 BTC sent by this group of investors when the coin reached a historical peak of $73,000 in March.

Regarding long-term holders (LTHs), their transfers to exchanges are relatively low, with only about 1,000 BTC/day currently. “LTHs send less than 0.006% of their total holdings to exchanges, suggesting that this group has reached an equilibrium and that higher or lower prices are needed to stimulate further action“, notes Glassnode.

The Bitcoin sent to exchanges generates an average profit of about $5,500, prompting some investors to sell to realize gains. While the market anticipates a rally towards the historical peak of $73,750, the demand is sufficient to absorb the selling pressure but not large enough to drive up the BTC price. A dynamic indicating some indecision among investors…