The analysts of blockchain data analysis agency Glassnode stated in their latest Weekly Report on the blockchain that Bitcoin holders have an average unrealized profit of about 120%, but “investor boredom” still dominates the entire market.
In the past few weeks, the price of Bitcoin has basically been in a sideways trend, with Bitcoin hovering around $65,300 at the time of writing. However, the profits of investors during the volatility period are still quite considerable. Glassnode found that the current average unrealized profit per Bitcoin holder is about 120%, similar to the situation when the market was at a historic high. In addition, with the market consolidating within this trading range, over 87% of the circulating supply of Bitcoin is currently in a profitable state.
Source:
Glassnode
The Glassnode report pointed out that after reaching new historical highs, the market usually needs sufficient time to consolidate and digest the introduced surplus supply. As balance is established, this will lead to a decrease in realized profits and selling pressure. The analysts stated that although this has reduced the upper resistance of the market, it has not yet translated into significant upward price momentum.
Source:
Glassnode
Glassnode attributes the price consolidation to “investor boredom and indifference” and points out that the scale of Bitcoin network transactions has slowed down, indicating a decrease in speculative interest. Glassnode concluded in the report:
Potential supply pressure of altcoins
Many altcoins are experiencing significant declines, and the digital asset research institution 10x Research analyzed the top 115 coins, stating that the average price of cryptocurrencies has fallen by 50% from the 2024 high. Markus Thielen, founder of 10x Research, believes that unless the liquidity of cryptocurrencies is improved, these losses will become more severe.
Thielen mentioned that Bitcoin and Ethereum (ETH) have performed relatively well during this period, with declines of about 11% and 13% respectively, which may benefit from smarter traders converting other altcoins into these two coins, as has happened in the past two cycles.
Cryptocurrency analyst Miles Deutscher stated that the number of tokens in the cryptocurrency market is more than 5 times the peak of the 2021 bull market, which is a major issue and may be the reason why cryptocurrencies are still struggling despite Bitcoin reaching new all-time highs. He wrote on the X platform:
“Unchained” cites Token Unlocks data reports that in the next month, more than 40 cryptocurrency protocols are expected to unlock tokens worth about $740 million.
In Deutscher’s view, token dilution is equivalent to the impact of currency inflation on traditional financial assets, which significantly reduces the purchasing power of cryptocurrencies. He pointed out that some solutions to this problem may be to enforce better token distribution at the exchange level and prioritize allocating more tokens to the real user community.
Data source: Glassnode