Over the weekend, the price of bitcoin fell below $60,000 as major holders such as the German and US governments sold rapidly. This led to one of the biggest declines seen for the pioneering cryptocurrency in two years, costing the market billions of dollars. However, bitcoin holders are still making substantial gains, with the immense majority of investors currently in the black despite the market crash.
Bitcoin Holders Enjoy Huge Profits
According to data According to on-chain tracker IntoTheBlock, there are around 53.57 million Bitcoin holders worldwide. Of these investors, a total of 83% have continued to make profits despite the BTC price falling below $60,000, as it currently stands at just over $56,000.
This number leaves only about 17% of all BTC holders who are currently not seeing a profit. Of this number, 13% are losing money, meaning they bought their BTC coins when the price was higher than the current value, leaving 4% of holders at breakeven. This means that these 4% bought their coins near the current value, so they are not making or losing money at the current price.
At these percentages, this means that around 44.61 million Bitcoin investors are still profiting from their positions. 6.8 million BTC holders are currently in losses, and around 2.16 million investors are currently at breakeven.
Interestingly, most of these investors who made a profit have an entry price below $50,000, meaning that even after another 10 percent drop, the immense majority of Bitcoin investors will still see profits on their assets.
Long-term BTC holders at risk of losses
While the data shows that the immense majority of Bitcoin investors are still making profits, there is a growing trend that is particularly affecting long-term holders of the cryptocurrency. In line with the mood reportaverage profits of long-term Bitcoin holders risk suffering losses for the first time in over a year.
That’s not a negative thing for the price, though, considering how BTC has historically responded when average long-term holder returns have turned negative. As Santiment notes, that’s typically a good time to buy, especially when “Bitcoin’s 30-day and 365-day MVRV are in negative territory.” The tracker added, “That’s when there’s a mathematical reasoning that you’re buying relative to other traders’ pain.”
To put into perspective just how good of a buying opportunity this is, “If you had bought the last time both lines were down, your return on BTC would have been +132%,” Santiment notes. Simply put, these events can often be a good indicator of where the bottom is and when to start buying.
Featured image created with Dall.E, chart from Tradingview.com
