Some metrics on the Bitcoin blockchain appear to reflect a pattern that implies confidence amongst market players. According to data from Glassnode’s on-chain insight, the current level of Bitcoin’s On-Chain Activity reveals that metrics are approaching levels associated with a re-accumulation period.
As Glassnode explains, the supply held in profit vs in loss has reached equilibrium. This is often synonymous with several month-long ‘re-accumulation periods’ in previous times.
The market is currently consolidating below the $30,000 midpoint, and 75% of the total supply is still in-profit, while 25% is held in loss. Notably, this pattern imitates the same balance recorded when prices reached the midpoints in 2016 and 2019.
The 75:25 balance of supply held in profit:loss is an equilibrium point for the apex cryptocurrency.
Additionally, higher Profit-to-Loss balances have been recorded on 50% of all trading days, while the remaining 50% was recorded on a lower one.
“This equilibrium point has historically taken time for the market to digest and re-consolidate around. Many Bitcoin analysts refer to this as the ‘re-accumulation period’, which tends to straddle the halving event. We can visualize this by looking at the proportion of the Market cap held at an Unrealized Loss. During the primary bear, the market is plunged deep into the red, with investors gradually capitulating out.” – Glassnode.
It bears mentioning that as the market forms and rallies off the lows, profitability levels have risen sharply to reach levels aligning with current market patterns. In the past, re-accumulation periods have been characterized by a lack of macro market direction which tends to be volatile and trades sideways for months.
“With the market back at this equilibrium point, it remains to be seen if a similarly lengthy and choppy process is needed to overcome it. On-chain activity for Bitcoin is cooling down somewhat, driven mostly by a decline in Inscription activity. Monetary transfer volumes, however are starting to pick up, displaying positive momentum often associated with growing liquidity and adoption.” Glassnode asserted.
Meanwhile, Bitcoin still struggles to sustain momentum at the $30,000 price level. The leading cryptocurrency has recorded a mild price decline over the last 7 days. Bitcoin now trades at a press time price of $30,356, not long after hitting a high of $30,959 a day ago.
