More Than 71% of Bitcoin Supply in Profit: Approaching Historical Pivot Level

With more than 71% of the Bitcoin supply currently in profit, the ratio is approaching the 74.7% level historically associated with transitions from bear to bull markets.

As Bitcoin trades around the $78,000 level, price action also points to a period of historically low volatility. According to Glassnode’s analysis, the most significant factor explaining the change in Bitcoin’s one-month realized volatility was long-term holder supply. Market cap, open interest, and funding rates lagged behind this indicator.

Glassnode noted that low volatility is more closely linked to who holds the coins rather than Bitcoin’s total market size. Bitfinex analysts, meanwhile, view the current outlook as an upward consolidation. Although Bitcoin briefly climbed above $82,000 last week, analysts state that confirmation for a sustainable rally has not yet been received.

Bitcoin Supply in Profit Approaches the 74.7% Threshold

According to Bitfinex analysts, more than 71% of the Bitcoin supply is in profit. During Bitcoin’s sideways movement in May, when it traded above $82,500, this ratio was approximately 67%. The increase in supply in profit could enlarge the liquidity pool, which may turn into selling pressure when the price retests previous local peaks.

Bitfinex analysts point out that levels above the historical average of 74.7% have historically been associated with transitions from bear to bull markets. However, the current picture suggests a continuation of Bitcoin’s bullish sideways movement rather than a confirmed breakout on its own.

It was also noted that ETF inflows and stablecoin growth are providing support to the market. In the near term, whether ETF flows remain positive and the US CPI data to be announced on September 11 will be key developments to watch to see if Bitcoin can break out of its current range.