Bitcoin Supply Profitability Hits Record High of 77%
• Glassnode’s latest report shows that 77% of the total Bitcoin supply is now in profit.
• The metric “percent supply in profit” works by going through the on-chain history of each coin and checking what price it was last moved at.
• The 7-day EMA value of the metric has surged this year, with an additional 6.2 million BTC coming into a state of profit since January.
Bitcoin Supply Profitability Reaches All-Time High
Glassnode’s latest weekly report reveals that 77% of the total Bitcoin (BTC) supply is now in profit, thanks to the rally seen so far in 2023. This is an all-time high for profitability among BTC holders, as 6.2 million coins have come back into the green since January this year.
What Is Percent Supply In Profit?
The metric used to determine how much of the Bitcoin supply is currently carrying some amount of unrealized profit is called “percent supply in profit”. It works by analyzing each coin’s on-chain history, and if its previous price was less than its current BTC value, it counts towards the indicator’s total value.
How Did The Metric Reach an All-Time High?
The 7-day exponential moving average (EMA) of this metric had hit a low point last year as multiple crashes drove many investors underwater. Following FTX’s collapse, only 44.7% (8.6 million BTC) remained within a profitable state. Since then however, we’ve seen a strong recovery with 14.8 million BTC now being counted towards profits –– representing almost double from the start of 2021!
What Does This Mean For Bulls?
As more and more coins become profitable again, holders will be looking to sell off their holdings and harvest some gains –– which could lead to tops forming for Bitcoin’s price action as investors look to cash out their profits gained over time.