Bitcoin (BTC) Supply in Profit Has Remained Above 70% So Far This Cycle

On-chain data shows the Bitcoin Supply in Profit is yet to drop under this key level during the current cycle, a sign that could be optimistic for BTC.

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On-chain data shows the Bitcoin Supply in Profit is yet to drop under a key level during the current cycle, a sign that could be optimistic for BTC.

Bitcoin Supply In Profit Has Remained Above 70% So Far

In a CryptoQuant Quicktake post, an analyst has talked about the the recent trend in the Supply in Profit for Bitcoin. The “Supply in Profit” is an indicator that keeps track of the percentage of the total BTC supply in circulation that’s being held at a net unrealized profit.

The metric works by looking at the transaction history of each coin in the circulating supply to see what price it was last moved at. The previous transaction of any token is likely to represent the last point at which it changed hands, so the price at that time would denote its current cost basis.

Naturally, if this acquisition level for a given coin is under the latest spot price, then that particular coin would be considered to be holding some net gain. The Supply in Profit adds up all tokens satisfying this condition and determines what part of the supply they make up for.

Another indicator called the Supply in Loss deals with the tokens of the opposite type. This indicator’s value can also be found by subtracting the Supply in Profit from 100, since both of the metrics must add up to 100%.

Now, here is the chart for the Bitcoin Supply in Profit shared by the quant that shows the trend in its value for the last several years:

As is visible in the above graph, the Bitcoin Supply in Profit hit the 100% mark earlier as the cryptocurrency’s price explored new all-time highs (ATHs). With the drawdown that has occurred during the last few months, however, the indicator has plunged.

In the chart, the quant has highlighted two lines that could prove to be of relevance to the asset. The bottom one (shaded in orange) corresponds to a value of 70%. It would appear that during the last cycle, losing this level meant the start of a bear market for BTC.

So far in the current cycle, Bitcoin is yet to see a drop below it. The closest it came was during last year’s consolidation phase. A level that the asset has dropped under a few times already this cycle is the 80% one, colored in yellow.

The recent correction also took the Supply in Profit below it, but the recovery rally has meant that it’s close to retesting the line again. During both the previous and current cycles, the initial break above the line signaled the start of the bull market for the coin.

Based on the pattern, the analyst has noted, “next target is to push the supply in profit back to 80% to signal strong bullish momentum.”

The post Bitcoin Supply In Profit Remains Above Key Level, Signaling More Optimism For BTC appeared first on Chain Link.

May the best coin win!

Sam Ben AvrahamThe crypto market has seen a significant shift in recent months, with Bitcoin (BTC) struggling to maintain its footing above the $70,000 mark. As the leading cryptocurrency faces pressure to regain its pivotal support level, analysts are closely examining on-chain indicators for insights into the asset's near-term prospects.

According to an analyst from CryptoQuant, a leading on-chain analysis platform, Bitcoin's Supply in Profit has remained above a key level despite the cryptocurrency's price volatility. The indicator, which tracks the percentage of the total Bitcoin supply that is holding a net unrealized profit, has stayed above 70% throughout the current cycle.

"The lower band of the Supply in Profit at 70% is highlighted in orange, while the middle band,