Bitcoin‘s on-chain activity indicates a two-month-long “buying frenzy” or “excitement spike.” Duration of such phase in previous bull market: [Specify duration here].
Bitcoin Has Been In Euphoria Wave Phase According To Supply In Profit
Based on Glassnode’s recent weekly analysis, the present Bitcoin cycle mirrors the last one in terms of “Bitcoin Holder Profitability.”
The “Percent Supply in Profit” indicator measures the proportion of all circulating Bitcoins that are being held at a profit.
By examining the past transactions on the blockchain for each circulating coin, this metric determines the price at which it was last traded. Considering that this transaction likely marked the most recent exchange of the coin, the price then represents its current cost basis.
In simpler terms, if the cost at which you bought a certain cryptocurrency is less than its current market price, then that specific coin has accrued some profit. The Percent Supply in Profit determines the total proportion of coins in circulation that represent such profitable holdings.
The “Profitability State” signal in the Bitcoin (BTC) market indicates its present stage, reflecting the market’s current profitability situation. Please find the chart below for a visualization of how this indicator has evolved over the past few years.
In the chart, the analytics firm has marked three significant lines for the Bitcoin Percent Supply’s Profit Metric. The middle line, which is colored blue, indicates the average of this metric. The lines in green and red represent a plus or minus one standard deviation from the average.
If over 95% of the Bitcoin supply is currently making a profit (Bitcoin Percent Supply in Profit being above +1 Standard Deviation), it’s possible that the market is exhibiting signs of euphoria or the build-up to euphoria.
In a similar manner, the Supply Profitability State identifies a below-average value phase for figures under -1 Standard Deviation. This region represents the “changing tide” or “transition” period between bearish and bullish markets.
According to the graph, Bitcoin experienced a 1.5-month-long phase before the recent bull market where its metric hovered near the +1 standard deviation line. Following this period of growth, Bitcoin went through a downturn and stabilized, causing the Supply in Profit to drop back below the +1 standard deviation threshold.
After a significant surge, the coin surpassed its one standard deviation mark and reached unprecedented peak prices, resulting in a full supply being held in profit.
Bitcoin experienced a familiar pattern recently. Before a significant price increase, there was a two-month period of growing excitement. This was then followed by a decline, after which came another two-month span marked by intense optimism and new record highs for the cryptocurrency.
If the current feeling of excitement and optimism about Bitcoin lasts as long as it did during the previous bull market, then we may have at least four more months of price increases.
BTC Price
Bitcoin regained ground and reached over $72,000 at one point, but more recently, its price has fallen back near $69,400.
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2024-04-11 07:41