submitted by /u/partymsl
A very basic correlation for a bear markets is the Supply in Profit, which is an on-chain metric that shows what percentage of the total circulating supply of Bitcoin is in profit right now or not. This metric has been used for every bear market and it shows that a bear market low was locally marked by a new low of the Supply in Profit, meaning that once a very big majority of people are in losses only then we reverse.
Also this time it is no different, Supply in Profit has dropped from over 90% to now 45.98% but this is actually not a new All-Time-Low. But once we remove the addresses that have not moved their Bitcoin in over 10 years we do hit a new record low at 32.73%, which is a very big difference for only removing a tiny few addresses in comparison.
Chart from OnChainCollege on Twitter
The reason for this massive drop and why we should actually view this metric in this way are quite a few. Firstly, those 10 year long holders are exceptional and hold a very exceptional amount of Bitcoin that can have a very big influence. Also, we should remember that a lot of, probably the majority, from back then has already lost their BTC so it does not make sense to include them.
This on-metric now depicts how much pain we actually have been through this bear market and actually in recent days due to our rally we have gone up in this metric to immediately over 70%, once again showing the significance of the current levels.
This past year was indeed very painful for all investors involved and will probably be remembered for quite a while into the future, surviving that was no joke to everyone that is still here.
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