Data Shows Average Bitcoin Investor Sitting on Big Profits Despite Dip

Despite the recent sell-off that pushed Bitcoin (BTC) prices below $60,000, a new analysis from Glassnode suggests the market remains remarkably robust.

According to the on-chain analytics platform, aggregate investor profitability is still strong, with the average coin holding a 2x profit multiple — a level often seen during the enthusiastic and euphoric phases of bull markets.

The #Bitcoin market is in an interesting spot, with the average coin still up 2x, whilst most Short-Term Holders are underwater.

A multitude of volatility measures are also heavily compressed, suggesting a larger move is on the horizon.

Discover more in the latest Week… pic.twitter.com/8J0MAKRraf

— glassnode (@glassnode) July 3, 2024

Glassnode’s analysis reveals that the average coin in profit holds an unrealized gain of $41,300, with a cost basis of approximately $19,400. Meanwhile, the average coin in loss holds an unrealized loss of $5,300, with a cost basis of around $66,100, primarily held by short-term holders.

This divergence highlights potential sell-pressure points as investors weigh realizing gains against mitigating losses. Notably, the magnitude of paper gains is 8.2 times larger than paper losses. This ratio has only been exceeded on 18% of trading days, all within euphoric bull market regimes.

Furthermore, Glassnode notes that while prices remain within the enthusiastic bull regime, the market is currently characterized by apathy and boredom despite Bitcoin being just 20% below its March all-time high. The average cost basis per active investor remains around $50,000, a key level the market needs to stay above to maintain the macro bull market.

The analysis identified three key pricing levels that could impact investor behavior. A breach of the $58,000 to $60,000 range would put many short-term holders (STHs) at a loss. Price action between $60,000 and $64,000 would continue the current sideways trajectory, while a decisive break above $64,000 would put a significant number of STH coins back into profit and likely boost investor sentiment.

At press time, Bitcoin had fallen over 4% in the last 24 hours, briefly touching $59,662 before settling at $60,200.

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