Bitcoin Profitability Near 50% Signals Past Cycle Upside
Bitcoin’s “total supply in profit” fell to 60.6% on Thursday, continuing to trade in the 50–60% range that has historically marked Bitcoin market cycle resets. The metric previously dipped to 50.8% on Feb. 5, the lowest since Jan. 2, 2023, when a large share of holders were close to breakeven or underwater.
In past cycles, similar profitability compression did not identify an exact bottom price, but it did coincide with periods where downside selling pressure eased and long-term accumulation dominated. In January 2023, when profitability was around 51%, BTC later rallied 655% to about $126,000 in 2025. A comparable setup occurred in March 2020, before BTC moved from roughly $6,500 to $69,000 in 2021.
Analysts note the long-term holder NUPL (LTH-NUPL) is still around 0.40, meaning long-term investors remain in profit even as overall “Bitcoin profitability” falls toward cycle-low zones. The article attributes this to a structural shift: corporate entities and spot Bitcoin ETFs control about 15.8% of circulating supply (~3,319,677 BTC), typically with less sensitivity to short-term price drops, reducing forced selling.
On flows, short-term holder BTC to Binance fell to about 25,000 BTC on March 25—down from ~100,000 BTC in early February—suggesting reduced reactive selling. Valuation-model mentions include MVRV below 1, NUPL under -0.2, and Puell Multiple near 0.35 as historical “stress/undervaluation” markers, though not precise bottom predictors.
Key takeaway for traders: Bitcoin profitability is approaching historically relevant accumulation zones, but the presence of ETF/corporate holders may mute liquidation-style sell pressure versus prior bear cycles.
Neutral
The article frames Bitcoin’s “total supply in profit” dropping toward 50% as a historically meaningful *accumulation zone*, but it repeatedly cautions that this metric does not pinpoint the exact bottom. That makes the near-50% setup mildly supportive rather than immediately bullish.
Why not bullish: long-term holder profitability (LTH-NUPL) is still positive (~0.40), which suggests forced liquidation pressure from long-term holders—so prominent in 2015/2018/2022—may be less intense now. Meanwhile, short-term holder selling has eased (STH flows to Binance down to ~25,000 BTC), which helps, but traders still need confirmation from price action and broader valuation stress indicators.
Why not bearish: the metric’s historical pattern shows reduced downside incentives and a tendency for upside follow-through after similar compression events (e.g., ~51% in Jan 2023 preceding the 2025 rally; <50% setups in 2020 preceding the 2021 move). The presence of corporate/spot ETF holders (about 15.8% of circulating supply) could further dampen selloffs, improving market stability.
Net effect for traders: expect more “range-to-recovery” behavior than a clear, immediate bottom call. Short-term volatility may persist, but the probability of downside being contained is higher than in earlier cycles.