- 95% of Bitcoin addresses are in profit, signaling strong market sentiment but also a potential risk of overextension.
- Institutional adoption continues to grow, with private wealth managers in Asia entering the cryptocurrency market, anticipating future gains.
IntoTheBlock data show a noteworthy change in the crypto market: about 95% of Bitcoin addresses are now in a profitable position. Since Bitcoin values shot beyond $60,000 at the height of the 2021 bull market, this degree of profit has not been experienced.
Usually seen as a strong indication of optimistic momentum, such high degrees of profitability imply that the market could be ready for more upward movement.
With 95% of Bitcoin addresses now in profit, market sentiment is booming. Historically, such levels have signaled strong bullish momentum but can also indicate a potential overextension.
Will we see a breakout, or is it a sign that the market is overheating? pic.twitter.com/8q1i9r4tJ8
— IntoTheBlock (@intotheblock) October 17, 2024
Bitcoin Psychological Price Level and Market Optimism
This general profitability has helped to create new hope among Bitcoin investors about the present state of the market. Given its current price behavior, many feel that the leading cryptocurrency is set for more increases.
Recently trading around $67,938, BTC rose 1.17% over the last 24 hours, momentarily reaching $68,000. For investors, who are eagerly observing to see if BTC can break through and keep momentum, this price point has become a major psychological level.
Simultaneously, the profitability data of Bitcoin draw attention to several possible issues. Historically, many people sell off their assets to make gains while so many of the investors are in profit. If this phenomenon is widespread, it could cause price corrections and hence stop the bullish trend.
In a few important respects, nevertheless, the state of the market today is different from past phases. First of all, the continuous debates on a possible Bitcoin spot ETF have given the market more hope. Moreover, increasing institutional acceptance of Bitcoin and other cryptocurrencies offers still another level of support that might help to counteract the usual profit-taking behavior.
Fascinatingly, studies on institutional Bitcoin interest reveal that it is still rising. As we previously noted, according to a recent Aspen Digital estimate, 16% of Asian private wealth managers are considering investment, while 76% of them have already dabbled in the crypto space.
Positive forecasts—including hopes that Bitcoin would hit $100,000 by the end of the year—fuel this increasing institutional acceptance. The possibility of long-term development of Bitcoin becomes more clear as more institutional participants and wealth managers join the market.
