That 93% of the available Bitcoin (BTC) is profitable seems to be good, but not in the medium term, it could establish a hard cap to overcome.
Bulls in the Bitcoin market have had a buoyant week as it has risen to more than $ 11,000, bringing it closer to its all-time high a bit more. This has several implications, for example the fact that 93% of BTC is now profitable, but this is not necessarily positive.
Profitability of the supply of circulating BTC tokens
It now appears that the leading cryptocurrency is poised to see a further upside as its technical strength has been building as it consolidates above $ 11,000.
As a consequence of this, currently almost 93% of Bitcoin’s supply is profitable, but this can be bad for BTC. Historically, when this percentage is reached, the cryptocurrency forms a ceiling in the medium term that results in a notable disadvantage.
That 93% of circulating Bitcoin is profitable refers to the vast majority of this amount being purchased below its current price. This indicates that the cryptocurrency may soon begin to struggle to maintain its strong momentum.
Therefore, this becomes a fact that we must keep an eye on. The same has been expressed by Glassnode recently. When these things happen, pushing higher until you hit the all-time high is tricky.
Their data reveals that cryptocurrencies generally form a maximum in the medium term once the percentage of tokens with profits reaches this level. Thus, BTC’s profitability is a warning signal about the strength of the ongoing uptrend.
What can we expect in the future to see if Bitcoin exceeds its historical maximum?
BTC’s rise above $ 10,500, and its consolidation above $ 11,000 affirms a change in resistance at the support level. This partially eliminates the possibility that it is a fleeting bull trap. Now the level to break would be between US $ 11,400-11,500.
Similarly, it would be necessary to monitor how crypto whales move in the face of this reality. If they start selling their cryptocurrencies given the possibility of making short-term profits, there would be more supply in the market. In these cases the price could drop.
However, until now the trend shown has been of accumulation, which in fact shows that they expect the price to continue rising.