Bitcoin metric flips: loss supply tops profit near bear-market support
Glassnode data shows a widely tracked bitcoin metric is flashing again: the supply of BTC priced at an unrealized loss has exceeded supply in profit.
As BTC trades around historically important bear-market levels, more than half of bitcoin in circulation is underwater. At roughly one-hour resolution, “supply in loss” peaked near 10.5 million BTC while “supply in profit” fell to about 9.8 million BTC. Total circulating supply is around 20 million BTC.
This crossover matters because it has historically coincided with major bear-market bottoms. Still, the length of time bitcoin stays in this loss-heavy regime varies across cycles, making it difficult to predict how quickly recovery could start.
Price context: bitcoin also tagged its 200-week moving average near $61,300 on Thursday—an indicator that has acted as major support in every previous bear market. The article notes a psychological $60,000 area and flags the next larger support zone around $54,000, near the realized price (the average on-chain acquisition cost).
If bitcoin drops below $60,000, traders may expect volatility to rise as the market tests the realized-price level. Conversely, the metric’s historical association with capitulation periods could support a “bottoming” narrative, though timing risk remains high.
Neutral
The bitcoin metric reported here—loss supply overtaking profit supply—has historically lined up with major bear-market bottoms, which can be a stabilizing factor for traders seeking capitulation signals. However, the article also emphasizes that the move is happening while price is only reaching (not yet decisively holding) long-term support, and it warns of downside levels ($60,000 and then ~$54,000 realized price). That combination makes the near-term trade setup uncertain: it can support a “bottoming attempt” narrative, but it does not confirm a durable reversal.
Historically, similar crossovers (2015, 2019, March 2020, 2022) varied widely in duration, suggesting that even if a bottom is near, it may take time and could include further shakeouts. Short-term, traders may tighten risk around the 200-week moving average zone and watch for confirmation via BTC holding above $61,300 and particularly above $60,000. Long-term, if realized-price support around ~$54,000 holds, the market may transition from heavy underwater positioning toward stabilization and recovery. Overall, the signal is more consistent with “cautious bottom-finding” than with an immediate bullish trend.