After the recent drop in the price of Bitcoin, and the increase in bearish sentiments, an analysis shows that to date just over 59% of bitcoin holders are still in the profit phase.
The queen of cryptocurrencies saw a sharp drop in a fraction of a second this week, falling $500 in about five minutes on Wednesday and staying at around $7500 since then.
According to a report, however, it is estimated that most of the addresses of bitcoin holders have bought bitcoin at an average purchase price of less than $7,470, thus remaining in the green earning zone until now.
To be specific, it seems that the data collected is based on an accurate analysis of the BTC in circulation. Here’s how the report describes the situation:
“Nearly 40 percent of all BTC in circulation was purchased sub-$4,300, with 2.87 million Bitcoins—almost 16 percent of the circulating supply—having been bought between $931 and $4,298”.
But while most bitcoin holders are in the profit phase, it is estimated that 39% of the rest are in net loss. They are those who have bought the digital gold at a price $10,000 higher, that is, its historical high.
Having said that, the analysis does not judge the current price as bearish but rather identifies the value of $6,649 as a new benchmark to be considered.
According to the platform, if BTC’s price were to remain above the $6,649 threshold, then most bitcoin holders would continue to remain in profit and therefore there would be no significant sales pressure to liquidate their digital gold.
In this respect, as a theory, the report points out as follows:
“Granted, Bitcoin futures markets could skew this theory. Leveraged futures offerings are suspected to have dramatically exacerbated recent price declines—extending small drops through key support levels into large, inorganic sell walls as traders’ positions are liquidated for margin calls”.
The analysis platform does not seem to be the only one to see the new level of key support lower than the current one.
Just yesterday, in an interview with the CNBC, Mike Novogratz said:
“I’m hoping it holds here, but $6500 would be the next downside to knock”.
