On-chain data shows around 2.7 million more coins entered a winning state after Bitcoin jumped above $25,000.
65% of the adjusted bitcoin supply is now in the green
According to on-chain analytics firm Glassnode, another 20% of adjusted supply is now benefiting from gains. The relevant indicator here is the “percent offer on profit”. As the name suggests, it measures the percentage of the total circulating bitcoin supply that currently contains unrealized gains.
The metric works by going through the on-chain history of each coin in circulation to verify what price it last moved at. If this previous value for a coin was lower than the last bitcoin price, then that coin is counted under the profit pool.
However, there is a problem with this indicator, and that is that a large amount of dormant supplies have been lost because the wallets that hold those coins are no longer accessible.
This old supply has recently been moving at very low prices compared to today’s BTC value, so it’s technically holding a massive unrealized gain. However, as these coins are being lost, they are essentially out of circulation supply and therefore should not affect the current market.
Because of this, the Supply in Profit indicator may gradually become inaccurate compared to the actual picture. To mitigate this problem, Glassnode developed the Adjusted Offer Percentage In Profit metric, a modified version of the original indicator that filters out the data of all coins older than 7 years.
Now here is a chart showing how the value of this bitcoin indicator has changed over the past week:
It looks like the value of the metric has seen some increase over the past few days | Source: Glassnode on Twitter
As shown in the chart above, Bitcoin’s adjusted percentage profit offer was around 45% just a few days ago when the price was hovering around the $20,000 mark. This means that 45% of supply under the age of 7 had increased slightly at that point.
Since then, BTC has seen strong bullish momentum, even briefly surging above $26,000 before seeing a pullback to the current $25,000 level.
As a result of this rapid growth, the adjusted supply of profit has also seen a big jump to around 65%, meaning that 20% of the adjusted supply, or 2.7 million coins, has now entered a profit condition.
A natural consequence is that investors bought 20% of the adjusted supply at prices between $20,000 and $26,000.
BTC price
At the time of writing, Bitcoin is trading around $25,100, up 13% over the past week.
The asset’s price seems to have seen some pullback from today’s high | Source: BTCUSD on TradingView
Featured image of Kanchanara on Unsplash.com, charts by TradingView.com, Glassnode.com
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