Cryptocurrency markets have taken the market by storm over the past week, with Bitcoin (BTC) making the most notable gains, surpassing the $30,000 mark for the first time in two months, providing much-needed confidence. It could be an important psychological milestone to regain. market.

At the time of writing, Bitcoin is trading at $30,343.

Over the weekend, Bitcoin managed to hold the $30,000 level, briefly surpassing $31,000. This price jump was fueled by a series of news about institutional introductions. This indicates growing mainstream acceptance and potential demand for digital assets, which has been a major driver of Bitcoin price since the beginning of the year.

This Bitcoin price surge has increased profitability for most holders. This is evident when analyzing on-chain data, especially profitable UTXOs. Unspent transaction output (UTXO) is the output of a Bitcoin transaction that has not been spent and can be thought of as individual “coins” or coin fragments residing in a Bitcoin wallet. They are very important when analyzing the market as they provide a snapshot of economic activity on the Bitcoin network.

Estimating profit and loss from the supply of Bitcoin is important as it provides insight into market sentiment and potential future price movements. One way to assess this is to analyze the current number of UTXOs that are in profit or loss.

Glassnode calculates the number of UTXOs in P&L by counting all existing UTXOs whose price was lower or higher than the current price when created. Considering the increasing number of UTXOs over time, the data is normalized by his UTXO size to get the relative number, or percentage, of UTXOs in profit and loss.

UTXO as a percentage of profits approaches 100% with each new record high. According to Glassnode, applying the 50-day Simple Moving Average (SMA) to the data best fits the historical data and produces a better signal for both global and local Bitcoin cycle tops.

BTC UTXOS profit for 5 years
Graph showing the share of Bitcoin UTXO in profits from 2018 to 2023 (source: glass node)

CryptoSlate’s analysis found that 86.24% of Bitcoin UTXOs are currently profitable. That jumped from 69.59% recorded on June 14th and fell slightly from the 14-month high of 86.8% recorded on June 23rd. This shows that most Bitcoin holders are currently profitable, which could have a significant impact on the future trajectory of the market.

BTC UTXOS 1 month
A graph showing the percentage of Bitcoin UTXO in profits from May 26th to June 26th, 2023 (Source: glass node)

However, the 50-day simple moving average (SMA) in Bitcoin UTXO profits is currently at 75%, down significantly from the 82.4% level recorded in May.

SMA is a commonly used technical indicator that helps smooth price data by creating a constantly updated average price. In this context, we can get a clearer picture of the overall trend of Bitcoin UTXO profitability over the last 50 days. The decline in the SMA suggests that UTXO’s overall profitability has been on a downward trend over the past two months, despite the recent surge in the Bitcoin price.

utxos has been profitable since the beginning of the year
Chart showing percentage of Bitcoin UTXO in year-to-date profits (source: glass node)

This could be due to various factors such as bitcoin holders losing money or creating new UTXOs at higher price levels. However, it remains to be seen whether this trend will continue, as the recent price surge has pushed UTXO to more than 86% of profits.

Over 86% of Unspent Bitcoin Gains as BTC Continues to Trade Above $30,000 This article first appeared on CryptoSlate.

By Jules

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