The analysts of blockchain data analysis agency Glassnode stated in their latest weekly report that Bitcoin holders have an average unrealized profit of about 120%, but “investor apathy” still dominates the entire market.
In the past few weeks, the price of Bitcoin has been mostly trading sideways, with Bitcoin hovering around $65,300 at the time of writing. However, profits for investors have remained significant during this period of volatility. Glassnode found that the current average unrealized profit per Bitcoin holder is about 120%, similar to when the market was at historical highs. Additionally, with the market consolidating within this trading range, over 87% of the circulating Bitcoin supply is currently in a profitable state.
Source:
Glassnode
Glassnode’s report points out that after reaching new all-time highs, the market usually needs ample time to consolidate and digest the introduced supply surplus. As balance is established, this will lead to a decrease in realized profits and selling pressure. Analysts state that while this has reduced the market’s overhead resistance, it has not yet translated into significant upward price momentum.
Source:
Glassnode
Glassnode attributes the price consolidation to “investor boredom and apathy” and notes that the scale of Bitcoin network transactions has slowed, indicating a decrease in speculative interest. Glassnode concludes in the report:
Potential supply pressure of altcoins
Many altcoins are experiencing significant declines, with digital asset research institution 10x Research analyzing the top 115 cryptocurrencies, stating that the average price of cryptocurrencies has dropped 50% from the 2024 peak. 10x Research founder Markus Thielen believes that unless the liquidity of cryptocurrencies improves, these losses will become more severe.
Thielen mentioned that Bitcoin and Ethereum 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 currencies, as seen in the past two cycles.
Cryptocurrency analyst Miles Deutscher stated that the number of tokens in the cryptocurrency market is more than 5 times higher than the peak of the 2021 bull run, which is a major issue and could be the reason why cryptocurrencies are 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, it is expected that over 40 cryptocurrency protocols will unlock tokens worth about $740 million.
Deutscher believes that token dilution is equivalent to currency inflation for traditional financial assets, significantly reducing the purchasing power of cryptocurrencies. He
points out
that some ways to address this issue may include enforcing better token distribution at the exchange level and prioritizing allocating more tokens to genuine user communities.
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