It’s hard to believe: thanks to a return of 100 percent over the last 365 days, the majority of BTC investors are sitting on green portfolios. Only investors who got in around the all-time high in mid-March were caught off guard by the recent price correction. According to data from The Block, 89.4 percent of investors are still in profit with their BTC investment.
This is not surprising. After all, despite its sideways trend, Bitcoin is still trading just 17 percent below its all-time high. The current cooling off can be seen as a necessary correction in a previously overheated market environment.
Because when almost everyone who has ever invested in BTC is in profit, profit-taking becomes increasingly likely. That’s exactly what happened during the all-time high in mid-March, as data from Glassnode shows.
In fact, such statistics should be treated with caution. The number of people who are making a profit is not so easy to estimate. After all, only UTXOs and addresses are visible in the Bitcoin network. The difficulty lies in clustering the addresses and thus assigning them to people or institutions. This is because individual people can control multiple addresses and individual addresses can hold the coins of several people (for example exchanges like Coinbase).
Data services such as The Block and Glassnode therefore use statistical clustering mechanisms. However, the results they produce are only approximate.
Bitcoin: What’s next?
Looking at the macroeconomic situation, Bitcoin is currently holding up quite solidly. High interest rates and increasing fears of recession in the US have been putting considerable pressure on cash-flow-less assets such as Bitcoin for some time.
You can read why there might be improvement on the horizon in our new Bitcoin Report.
This might also interest you