Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and publishing How Our News is Made Strict editorial policy that focuses on accuracy, relevance, and impartiality Ad discliamer Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio. The Bitcoin supply in profit has seen a sharp decline amid the latest crypto market crash. This has raised concerns that BTC could suffer a further crash, as holders who are in the red may move to offload their coins. Bitcoin Supply In Profit Drops Amid Market Crash
On-chain analytics platform Glassnode revealed in a reportthat the Bitcoin supply in profit has historically dropped to around 85%, with 15% of the supply sitting at a loss. This has occurred whenever the BTC price breaks down from a new all-time high (ATH) and trades around the short-term holders’cost basis, as is happening now. Related Reading Bitcoin Supply In Profit Sees Sharp Decline With Market Crash – Here Are The Numbers 4 hours ago
Glassnode noted that this marks a pivotal phase for Bitcoin, as this is where the market tests the conviction of investors who had bought near recent highs. This pattern is said to be playing out for the third time in this current cycle. The on-chain analytics platform warned that if BTC fails to recover above the $113,100 range, a deeper contraction could send a larger share of the Bitcoin supply into loss. Source: Chart from Glassnode on X
Glassnode further stated that this deeper contraction could amplify the stress among recent Bitcoin buyers, which could set the stage for a broader capitulation across the market. The platform also alluded to the Supply Quantile Cost Basis to explain why it is essential for BTC to reclaim the short-term holders’ cost basis above $113,000.
Bitcoin is said to be struggling to hold above the 0.85 quantile at $108,600. Failure to hold this has historically indicated structural market weakness and often preceded deeper corrections toward the 0.75 quantile, which now aligns near $97,500. This puts BTC at risk of droppingbelow $100,000 for the first time since May. A Longer Consolidation Phase May Be Necessary
Glassnode stated that from a macro perspective, the repeated demand exhaustion suggests that Bitcoin may require a longer consolidation phaseto rebuild strength. This exhaustion is said to be clearer with the Long-Term Holder Spend Volume. These long-term holders have increased their spending with the 30D-SMA rising from the 10,000 BTC baseline to over 22,000 BTC daily since the market peak in July. Related Reading Is Bitcoin About To See A Repeat Of 2020-2021? What Happened After The Last Flash Crash 1 week ago
Glassnode noted that such persistent distribution indicates profit-taking from seasoned investors, which has contributed to the current Bitcoin weakness. Bitcoin OGs have continued to offload their coins at an unprecedented rate, putting significant selling pressure on BTC. Onchain Lens recently revealedthat a particular whale moved 3,003 BTC to Binance, likely in a bid to sell, while also shorting BTC with a position worth $227 million.
At the time of writing, the Bitcoin price is trading at around $108,800, up in the last 24 hours, according to datafrom CoinMarketCap. BTC trading at $109,750 on the 1D chart | Source: BTCUSDT on Tradingview.com Featured image from Pixabay, chart from Tradingview.com