Bitcoin Struggles to Break Higher, But Majority of Holders Remain Profitable
Despite the recent rejection from the $70k mark, the majority of Bitcoin (BTC) holders are still in a profitable position. MicroStrategy, a company that recently purchased a significant amount of BTC, has contributed to this trend. However, the slight uptick in Bitcoin’s price, which briefly exceeded $65,000, has since dropped back below $64,000.
According to data from IntoTheBlock, 87% of BTC holders are still in profit. This is largely due to the fact that most holders acquired BTC at lower average prices compared to the current level. On-chain data reveals that 46.72 million addresses are currently in profit, while 5.68 million addresses are holding their coins at a loss, accounting for nearly 11% of all addresses. Only 2.67%, or 1.44 million addresses, are at break-even, acquiring BTC at prices equivalent to the current trading price.
Bitcoin has faced challenges in its upward movement recently. After reaching an all-time high above $73k in March, BTC experienced a decline to lows of $56k in early May. It then spiked to above $71k, only to be rejected at this level on May 21 and again in early June.
As of now, Bitcoin is trading around $63,700, while Ethereum (ETH) is valued at approximately $3,503. Both cryptocurrencies have experienced a decline in the past 30 days, with BTC down 8% and ETH down 6%. These performances are influenced by various factors contributing to the bearish sentiment.
IntoTheBlock analysts identify the range between $61.9k and $63.8k as a potential key support area for Bitcoin.
One of the catalysts for the recent sell-off pressure in BTC is the net outflows from spot Bitcoin ETFs. Additionally, miners have continued to sell their BTC since the halving event. On-chain data confirms that miners have sold over 30,000 BTC in June.
Bitcoin analyst Willy Woo believes that miner capitulation will play a significant role in BTC’s short-term downside. He explains that Bitcoin will recover when weak miners exit the market and the hash rate rebounds. However, miner capitulation is taking longer than in previous post-halving periods due to factors that have increased miner profits.
Furthermore, the German government’s potential dump of Bitcoin has added to the sell-off pressure this week. Earlier this year, German police confiscated 50,000 BTC, valued at $2.1 billion at the time, from the pirated film site “Movie2K.” The surge in Bitcoin’s price has since increased the value of the seized coins to over $3 billion. The BTC address associated with the seizure has transferred over $110 worth of Bitcoin to exchanges like Kraken and Bitstamp.