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- The proportion of Bitcoin investors realizing profits has decreased by 18% (from 93% at the end of July to the current 75%), coinciding with Bitcoin’s price dropping below $50,000.
- The last time the percentage of BTC addresses in profit was at comparable levels was in January, when the price reached a low of $39,000 before climbing to $73,000.
- Analysts indicate a risk of further declines to $40,000.
The share of Bitcoin holders in profit has seen a notable decline in recent days, underscoring the effects of the recent downturn in the crypto market.
The fraction of BTC investors in a profitable position has fallen from 93% at the end of July to 75% at present. This reduction aligns with Bitcoin’s price dipping below $50,000, a threshold not observed since February of this year.
The last occurrence of the percentage of BTC addresses in profit being at similar levels was in January, when the cryptocurrency’s value reached a local low near $39,000.
This price decline followed the introduction of Bitcoin exchange-traded funds (ETFs) in the United States, which subsequently propelled the cryptocurrency’s price to $73,000.
As Bitcoin’s price declined to $50k, the percentage of holders in profit fell to 75%.
This level was last recorded in January when prices established a local bottom around $39k. pic.twitter.com/CAR5ju5VOR
— IntoTheBlock (@intotheblock) August 5, 2024
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Over the past week, Bitcoin experienced a sharp decline, plummeting from a high of $70,000 to approximately $50,000 in less than a week. The price briefly dipped to $49,513 before a slight rebound brought it to around $54,600 at the time of this report.
Bitcoin (BTC) May Continue To Plunge
If Bitcoin’s price persists in its downward trend, it is probable that the percentage of holders in profit will continue to diminish.
Despite the current fluctuations, analysts propose that the bullish phase of the market is not yet concluded. The number of addresses in profit may rise in the upcoming weeks, contingent on a potential price recovery.
Some analysts believe that outflows from ETFs, uncertainty regarding the U.S. Federal Reserve’s monetary policy, and economic instability in the country could be contributing to the price decline.
Furthermore, Arthur Hayes, co-founder of the trading platform BitMEX, posits that a significant sell-off by a major investor could be responsible for the recent downturn.
CryptoQuant analysts caution that investors may encounter negative profit margins in the forthcoming days, as BTC could drop to $40,000. The situation remains unpredictable, and future price movements will be pivotal in shaping the market’s direction.
