- BTC’s supply in earnings rose to 72.3% on July 4, according to data from Glassnode
- Bitcoin has regained its appeal and inflation may no longer be a major threat.
Profitability is one of the biggest factors investors consider before buying an asset. This is how you can find the latest statistics from Glassnode about Bitcoin [BTC] profitability quite interesting. Possibly even confusing.
Is your wallet green? Check out the Bitcoin Profit Calculator
The supply of BTC in earnings recently jumped to 72.3%. But what exactly does this mean for traders? Less than 50% of the supply in earnings at the trough during the trough in 2022.
With the market recovering, BTC profitability has also improved. But that is not everything.
The adapted #Bitcoin Percent supply in profit has reached a value of 72.3%, which is equivalent to 10.8 million coins with a profitable position.
When assessing the percentage of trading days with a value higher than 72.3%, we find that 49.2% of trading days recorded a higher value. This… pic.twitter.com/yiGX6Hm9MW
— glassnode (@glassnode) July 4, 2023
The BTC profit offer is based on prices above USD 30,000. In other words, about 72% of BTC acquired below the $30,000 price range is now making a profit. While that number seems high, it suggested that there was a fairly high level of trust among BTC holders.
On the other hand, it also draws attention to the potentially heavy selling pressure if investors are incentivized to sell.
Will inflation ultimately favor BTC?
Market direction remains at the mercy of multiple market factors. Inflation has been one of the main factors affecting BTC prices in recent months. This is because the cure for inflation has usually raised interest rates.
Unfortunately, high interest rates discourage investment, causing asset prices to fall. Recent data suggested analysts expect lower core inflation.
Core inflation is the concern, which is also expected to be lower by this month’s release… but not where it should be. pic.twitter.com/80lv0u02Hl
— tedtalksmacro (@tedtalksmacro) July 4, 2023
BTC prices were bearish during months when inflation escalated. This means that higher-than-expected inflation could create some selling pressure. However, that may not necessarily be the outcome as BTC was originally created as a hedge against inflation. But highly leveraged BTC positions played a big role in initiating selling pressure due to liquidations.
Recent findings also showed that BTC was now no longer correlated with the S&P 500. In other words, BTC no longer plays by the rules of the traditional investment market. Some see this as an opportunity for BTC to finally function as an inflation hedge. After all, most of the overleveraged liquidity has already been removed.
Bitcoin’s correlation to the S&P 500 has returned to zero.
Since blockchain is in no way tied to interest rates, it should have a very low correlation to major asset classes (stocks, bonds, real estate), which are closely driven by rates.
More: https://t.co/6xoXJhvU04 pic.twitter.com/GZNXJNzZKz
— Dan Morehead (@dan_pantera) July 3, 2023
A look at address activity revealed that more whales have found BTC attractive in recent months. For example, the addresses have increased by at least 1,000 BTC since the beginning of March.
Source: Glassnode
Read about Bitcoin [BTC] price forecast 2023-24
In short, BTC has received a lot of attention in recent months. Market confidence has improved significantly, especially after the events of 2022, judging by profitability. So much that even whales get in on the action.