The recent cryptocurrency market momentum is not doing traders and speculators any favors. Bitcoin enthusiasts are having a tough time as the currency continues to struggle. As the supply in profit hits a fresh eight-month low, things are not looking too great just yet.
Bitcoin Supply In Profit Dips Hard
When the Bitcoin price drops as significantly as it has in the past few weeks, there will be some issues to contend with. The drop from $64,000 to $44,000 is rather spectacular, although it was to be expected as well. Why the price continues to drop despite dropping so low already will remain a topic of debate.
One metric depicting how dire the situation has become is the Bitcoin percent supply in profit. Despite recording some very high levels in recent months, that momentum is now evaporating completely. As things stand, 81.12% of the current Bitcoin supply remains in profit. That is a more than respectable amount, given the current circumstances, but it is far from what users prefer to see. Coming down from a high of over 95% to this level is a rude awakening for everyone.
It is the first time since October 2020 such a low level of Bitcoin supply in profit is reached. It confirms how strong the recent bull run has been, but the market needs a breather before attempting its next leg up. When that momentum materializes is difficult to predict, Today’s minor uptrend has been nipped in the bud already, and it seems more bearish pressure is on the horizon.
As 3.48 million BTC are now worth less than at the time of their purchase, things are bound to get rather interesting. For some users, now may be the time to sell their Bitcoin stash and not look back. Others will see it was a time to accumulate more Bitcoin, either for better or worse. The coming days and weeks may prove crucial for the world’s leading cryptocurrency.
UTXO’s In Profit Drop Off Quickly
As the Bitcoin price continues to drift lower, more people will be dealing with a negative return on investment. As things stand, the UTXOs in profit is also at a six-month low. This metric is interesting as it compares the current value to the last time users moved that BTC supply across the network. There is usually a bigger chance for UTXOs to be in profit, but not right now.
The decrease for UTXOs in profit is not entirely problematic either. The six-month low isn’t a good sign, yet the previous low was recorded in late January 2021. There is still a strong Bitcoin price performance in 221, even if some of the gains have been eroded in the past few weeks. Recovering those gains will not come easy, but nothing is impossible in the cryptocurrency industry, either.
It will take some time for both of the metrics to recover. The supply in profit will usually recover a bit quicker compared to the UTXOs. However, those who hope to see Bitcoin return to $50,000 and higher will have to wait just a bit longer. Surpassing $60,000 again may not happen for some time to come, given the current bearish market pressure.