On-chain data shows the Bitcoin network has witnessed a spike in profit-taking activity from investors, but so far, the price has managed to hold.
The metric works by going through the transfer history of each coin being sold or moved to see what price it was transacted at prior to this. If this previous transaction price is less than the current selling price for any token, then that particular coin’s sale is leading to the realization of a gain equal to the difference between the two values.
Now, here is the chart shared by the analytics firm that shows the trend in the Bitcoin Realized Profit over the past few months:
Note that the version of the Realized Profit in the chart is the “Entity-Adjusted” one, meaning it tracks not only the transfers occurring between different wallets but also the transfers between different entities.
Glassnode defines an ‘entity’ as a cluster of addresses that it has determined to belong to the same investor through its analysis. Naturally, moves happening between the wallets of the same owner don’t reflect the realization of any profit, so accounting for entities cleans out the data.
Now, the indicator has experienced a few more of these spikes, corresponding to profit-taking sprees exceeding $500 million per hour. Thus, it would seem that the investors aren’t yet done harvesting their gains.
This time, however, Bitcoin hasn’t seen a move down so far. It only remains to be seen, though, how long this would last if spikes in the Realized Profit continue to emerge.
At the time of writing, Bitcoin is floating around $104,900, down almost 4% in the last seven days.
