Glassnode: Three-quarters of BTC Addresses Still Profitable Despite Market Slump

The price of Bitcoin has fallen again recently, but a new analysis by blockchain analytics firm Glassnode shows that a whopping 75% of Bitcoin addresses are in profit.

Glassnode’s chain weekly report released on April 11 analyzed the number of profitable Bitcoin wallets and found that about 70%-75% of addresses had unrealized profits, much higher than the 45%-50% during the 2018 bear market.

Commenting on the findings, analysts at Glassnode added that the current bear market is far less bad than previous ones:

“The current bear market is not as severe as the worst phase of all previous cycles, with only 25%-30% of the market in unrealized losses. It remains to be seen whether further sell-side pressure will push the market lower, thereby reducing the The market is pulled further into unrealized losses, as it has been in previous cycles."

The report further revealed that long-term Bitcoin holders (those who hold for more than 155 days) are the least likely to lose money. More than 67.5% of long-term holders are in a state of unrealized profits, while among short-term holders (those who hold for less than 155 days), only 7.88% of them have obtained benefits.

Bitcoin is currently trading below $40,000 and has dropped to nearly $39,000 in the past 24 hours, bringing the asset back into bear market territory. Bitcoin’s direction has some speculating it will drop to $30,000, while other data shows traders are trying to push the price to $50,000.

The report also detailed that 58% of the Bitcoin network’s transaction volume is in what it calls “profit-dominated,” a metric that hasn’t been much observed since December 2021.

Glassnode added that bear markets typically feature volumes that create losses for a long period of time, and this reversal to profit-led could be a signal that sentiment is shifting and demand for Bitcoin is able to offset selling.

However, Glassnode wrote, "Given that prices continue to struggle, it does suggest that the demand side remains somewhat subdued and investors are cashing in on any signs of strength in the market."

The analyst added that since mid-February, the market has realized profits of about 13,300 BTC per day, while realized losses per day have fallen from about 20,000 BTC in January to about 8,300 BTC last week.

According to analysts, while the majority of addresses and transactions are making a profit, the overall number of users on the Bitcoin network, and subsequently the number of transactions, continues to "malaise."

The Bitcoin network sees around 225,000 transactions per day, a similar number to the 2018-2019 bear market. Trading volumes began to climb from mid-2021, but analysts noted that "this is a far cry from the hype cycle observed during bull markets."

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