Blockchain data is on the agenda again for investors who want to catch the bottom levels in the Bitcoin market. Looking at long-term cycles, balancing supply in profits and losses often signaled the end of major declines. The “BTC supply in profit and loss” indicator tracked by Glassnode has accurately reflected critical turning points in the past. Latest data reveal that this balance is in the process of being re-established.
What Does BTC Supply Mean in Profit and Loss?
The “BTC supply in profit vs. loss” metric, developed by intra-blockchain analysis company Glassnode, measures the cost levels at which Bitcoins in circulation are purchased. The indicator classifies coins purchased below the current market price as in profit, and coins purchased above the current market price as in loss. Thus, the psychological and financial position of investors can be monitored more clearly.
According to the data, currently approximately 11.1 million Bitcoins have been acquired below the current market price and are in the profit zone. On the other hand, 8.9 million BTC is in a loss position. The fact that the two groups are approaching each other shows that there is a widespread surrender process in the market and the selling pressure has reached saturation.
According to experts, equalizing the profit and loss balance does not only provide technical data. It is also considered a collective reflection of investor behavior. In long-term decline periods, an increase in the supply at a loss symbolizes a loss of confidence, while maintaining balance brings the possibility of a new recovery to the agenda.
How Did the Bottom Signal Work in Past Cycles?
Historical data reveal that the indicator in question worked effectively during many major crisis periods. After the collapse of FTX in November 2022, when Bitcoin fell to $ 15,000, the supply in profit and loss was almost equal. A similar picture was seen in March 2020, during the global panic caused by the pandemic, when the price fell below $ 3,000.
In the 2018-2019 bear market, levels of approximately $3,300 were recorded as another period when the same metric signaled the bottom. Going back further, the equilibrium point around $200 in 2015 formed the basis of the subsequent bull market. In each example, a period in which the majority of investors write losses and the desire to sell reaches its peak is noteworthy.
The current chart displays a similar structure to past cycles. The rapid convergence of BTC amounts in profit and loss shows that the search for a new balance has begun in the market. Although analysts emphasize that the timing of a definitive bottom level is uncertain, they state that the metric in question remains an important reference for long-term investors.
