The proportion of circulating Bitcoin in a profitable state reached a peak of over 83% this week, marking the highest level since November 2021 when the world’s largest cryptocurrency achieved its all-time high, as reported in Monday’s Bitfinex Alpha report. Glassnode data also confirmed this multi-year high.
“With Bitcoin trading above $37,000 last week, over 83% of the coin supply has moved back into profitable territory,” noted Glassnode on X.com. However, the blockchain analysis firm emphasized that “the unrealized profit’s magnitude remains moderate, and is not yet enough for long-term investors to divest.”
According to Bitfinex, more than 16.3 million bitcoins are currently in a profitable state. Bitfinex analysts stated, “The current percentage of Bitcoin held in profit is significantly higher than the all-time average of 74%.” The report suggests that this signifies the market is in a relatively robust position, with a substantial majority of Bitcoin holders experiencing positive returns on their investments.
Recent data from The Block’s dashboard also indicated the strengthened position of the Bitcoin market. For three consecutive days last week, the 7-day moving average of total transaction fees on the Ethereum and Bitcoin networks favored BTC for the first time since November 2020.
There is an accumulation occurring among long-term holders.
Bitfinex analysts have reported that approximately 70% of the total circulating supply of Bitcoin has remained inactive over the past year, marking a new record high, as stated in the report.
“This is creating upward pressure as growing demand pursues a restricted supply,” the analysts emphasized.
In a communication sent to The Block, Bitfinex analysts noted a distinct behavior pattern in the current dynamics of long-term holders compared to past cycles.
“In this ongoing cycle, there have been fewer instances of long-term holder supply fluctuations due to spending, indicating a trend of consistently expanding supply. This implies a level of supply constraint in the Bitcoin market, despite the profitability of long-term holders on a relatively significant scale,” stated the analysts.
The Bitfinex analysts concluded their report by asserting that current conditions align with the notion that the market is in the early phases of a bull market.
“Bitcoin continues to exhibit strength while maintaining its current range,” added the Bitfinex analysts. At 12:40 p.m. ET, it was trading at $37,093, according to data from The Block.