Key Points
- Despite Bitcoin’s narrow price movements, holders continue to see profits on their investments.
- The volume of coins being processed and transferred on the Bitcoin Network has declined since March’s all-time high.
Despite the limited price fluctuations of Bitcoin (BTC), investors continue to reap profits. This trend persists even though the leading cryptocurrency has been trading within a narrow range in recent weeks.
At the moment, Bitcoin is trading at $65,625. It has been moving within a horizontal channel, facing resistance at $71,656 and finding support at $64,825. Nevertheless, the profitability of Bitcoin investors remains strong despite this sideways price movement.
On-Chain Data Analysis
According to on-chain data:
“BTC prices are consolidating within a well-established trade range. Investors remain in a generally favorable position, with over 87% of the circulating supply held in profit, with a cost basis below the spot price.”
The Market Value to Realized Value (MVRV) ratio of the coin was evaluated, revealing that the average Bitcoin in circulation has an unrealized profit of over 120%.
Interestingly, even though Bitcoin holders are profitable, the volume of coins being processed and transferred on the Bitcoin Network has significantly reduced since the all-time high in March. This indicates a reduced appetite for speculation and increased market indecision.
Exchange Activity Decline
The price consolidation of Bitcoin has also resulted in a decrease in BTC exchange flows. Short-term holders (STHs), who typically hold their coins for less than 155 days, currently send approximately 17,400 BTC to exchanges daily. This is a 68% decrease from the 55,000 BTC sent to exchanges when Bitcoin reached an all-time high of $73,000 in March.
Long-term holders (LTHs), on the other hand, are sending less than 0.006% of their total holdings to exchanges. This suggests that this group has reached equilibrium and that price changes are needed to stimulate further action.
The average Bitcoin sent to exchanges generates a profit of approximately $5,500. This has encouraged some long-term holders to sell for profit. As the market anticipates a rally to the $73,750 all-time high, there is enough demand to absorb the selling pressure. However, it is “not large enough to push market prices higher.”
