Most Bitcoin Holders Now Profitable, According to Blockchain Data

Bitcoin Market Update: Almost All Holders are in Profit

With Bitcoin’s (BTC) price quickly re-approaching its all-time high, almost all holders of the digital currency are back in the black. Blockchain market intelligence platform IntoTheBlock stated that 95% of Bitcoin addresses are now in profit – the largest share since BTC traded for roughly similar prices in November 2021.

Bitcoin Market Heat and Speculative Activity

While profits are great for investors, a big portion of the market being in the green can also mean the market is overheated, and that a large number of holders may take money off the table. IntoTheBlock recommends gauging market heat using the MVRV ratio, which measures the “market value” of all BTC against the “realized value” of when they were last traded. The current value is 2.22, indicating a high level of profitability.

On-chain data published by Glassnode suggests that more speculative trading activity is already starting to return to BTC. For example, Bitcoin inflows to exchanges are nearing all-time highs, with those flows predominately coming from short-term holders more likely to be interested in speculative activity.

Factors Driving Bitcoin’s Price Surge

Bitcoin’s price surged to $57,000 on Monday, breaking another two-year high as Bitcoin ETFs continue absorbing a tsunami of inflows. The newly launched funds took in another $520 million on Monday alone, with BlackRock’s iShares Bitcoin Trust scoring a record $1.3 billion in daily volume.

Several analysts believe Bitcoin ETFs will be a primary catalyst for taking the asset back to its all-time high of $69,000 – possibly before the Bitcoin network’s “halving” event in April. When it occurs next, the number of BTC produced per day will fall from 900 to 450 coins, potentially triggering an upswing in price according to experts.

Market Predictions

Last week, Fundstrat’s Tom Lee predicted that both ETFs and the halving could drive Bitcoin’s price to $150,000 by the end of 2024, indicating a bullish outlook for the cryptocurrency market.