Bitcoin has recently surged, with a notable increase in ETF inflows indicating high demand. However, analysts urge caution due to the risks associated with increased leverage.
As reported by the blockchain analytics firm Glassnode, approximately 97% of Bitcoin (BTC) supply is reportedly in profit.
“Building on the accumulation trend, Bitcoin’s rally to a new all-time high has lifted nearly all circulating supply back into profit.”
High levels of profitability often lead to consolidation, which suggests that while profits are being realized, they remain contained, indicating a stable rotation of assets rather than mass distribution.
This suggests a market characterized by profit-taking rather than panic sales, a common feature of a healthy bull market where selling is balanced by renewed interest from buyers.
Potential Correction to $117,000
Glassnode highlighted structural support through a tool called the “Cost Basis Distribution Heatmap,” revealing that support is limited between $121,000 and $120,000, and notably stronger near $117,000, where about 190,000 BTC were last acquired.
“While price discovery phases inherently carry the risk of exhaustion, a potential pullback into this region could invite renewed demand as recent buyers defend profitable entry zones.”
Thus, the $117,000 mark is crucial for monitoring stabilization and the resurgence of momentum.
Escalating ETF and Futures Trading Volumes
Additionally, Glassnode pointed out that rising trading volumes indicate significant institutional interest in Bitcoin futures and spot ETF markets, but the growth in leverage might introduce some short-term risks.
Inflows into spot Bitcoin ETFs in the United States surpassed $2.5 billion this week, marking one of the highest inflow days in recent history, according to CoinGlass.
These recent onchain signals suggest a robust yet maturing uptrend, one that remains stable yet increasingly sensitive to profit-taking and leverage adjustments as Bitcoin continues its price exploration.
Overall, Bitcoin prices have declined from a recent high of $124,000 to just under $122,000 at the time of this writing.
