Bitcoin has just returned a clear majority of its supply to profit. After rising from around $62,000 to nearing $80,000 in one week, 69% of BTC in circulation now display a value higher than their on-chain reference level. The rebound therefore repaired part of the losses. Not all: around $617 billion of capital still remains underwater.
In brief
- 69% of Bitcoin’s supply is now in profit.
- BTC rose from around $62,000 to almost $80,000 in a week.
- About $617 billion of capital still remains in losses.
Bitcoin puts 69% of its supply back in the green
The movement accompanies the violent rebound observed since mid-August. Bitcoin had returned to the $80,000 zone after several months of high volatility. CryptoQuant estimates now that 69% of the supply is in profit. The indicator compares the current price with the BTC reference level observed on-chain. When a bitcoin finds itself above this level, it moves into the “supply in profit” category.
The recent rise has therefore tilted many corners to the right side. A few days earlier, the situation seemed much less comfortable. Bitcoin had fallen towards $62,000 after several successive corrections.
Then the price recovered more than 25%. Holders who had bought or moved their BTC around $65,000, $70,000 or $75,000 gradually returned to a positive position. 69% of the offer. The figure is impressive.
A large part of profitable BTC hardly moves anymore
However, we must look at the composition of this offer. Bitcoin has spent most of the current cycle with over 50% of its coins in profit. According to data reported by CryptoQuant, the ratio only fell below this threshold for around 15 days before the July rebound.
A large portion of the affected bitcoins have also been dormant for a long time. The former holders had already significantly reduced their sales. In July, 79% of Bitcoin supply was in the hands of long-term investors. Some of these BTC were acquired at very low prices.
A bitcoin purchased ten years ago obviously remains profitable at $70,000 or $80,000. That it goes from 62,000 to 78,000 doesn’t change much for its owner. This mechanically inflates the part of the profitable offer. The 69% therefore provides information on the state of the network. It doesn’t mean that 69% of the money recently invested in Bitcoin is making money. And this is where the numbers become less comfortable.
$617 billion still remains underwater
CryptoQuant also looks at committed capital. The result differs greatly. Around $617 billion linked to the BTC supply would still remain in losses despite the rebound. A significant portion of the money that arrived at higher levels has therefore not yet recovered its losses.
Investors who entered near previous highs are still waiting. This is also why a return of Bitcoin towards $80,000 is not enough to consider the market completely repaired. The levels above still concentrate many holders likely to sell once they return to balance.
The market will have to absorb them. CryptoQuant is already monitoring a higher area. The firm believes that Bitcoin would need to cross around $83,000 to more frankly confirm the return of a bull market. BTC is not very far away. The rebound has already brought 69% of supply back into profit. The $617 billion still in the red is simply a reminder that some work remains to be done.
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