Key points:
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Bitcoin’s NUPL metric repeats past bull-market tops with a move from “optimism” to “euphoria.”
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The Bitcoin realized cap is increasingly in the hands of short-term holders.
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New investors continue to get squeezed by range-bound BTC price performance.
Bitcoin (BTC) may be in its “final expansion” to a blow-off top despite recent lows, new research says.
In one of its Quicktake blog posts on Wednesday, onchain analytics platform CryptoQuant showed BTC price history repeating itself.
Bitcoin NUPL implies “shift from optimism to euphoria”
Bitcoin is headed for its new cycle top as the balance of control between old and new hodlers shifts.
CryptoQuant data revealed that the ratio of unrealized profit and loss (NUPL) has crossed into territory that has accompanied previous blow-off tops.
“The NUPL currently sits at +0.52, a zone historically marking the shift from optimism to euphoria,” contributor XWIN Research Japan wrote.
“In previous cycles, such as 2017 and 2021, NUPL readings above 0.5 signaled that most investors were in profit, driving speculative activity. Today, around 97% of circulating supply is in profit, reflecting strong market confidence but also suggesting limited upside without consolidation.”
Speculatory entities — those hodling for up to 155 days and defined as short-term holders (STHs) — now make up a record 44% of Bitcoin realized cap.
Realized cap is the sum total of the supply at the price at which it last moved. CryptoQuant explains that a high STH ratio implies that newer investors are inheriting the supply from older investors who are taking profit. This includes the largest investor cohort, the whales.
“In past cycles, this transfer of dominance from LTH to STH has coincided with the final expansion phase of a bull market,” the post continued.
XWIN acknowledged that the current bull market stands out against the rest. Thanks to large-scale institutional involvement, the impact of realized cap shifts may be reduced.
“However, this time the structure appears different: ETF inflows, expanding stablecoin liquidity, and institutional participation are absorbing sell pressure, forming a more stable type of euphoria,” it added.
“Overall, on-chain data indicates that Bitcoin is in a mature speculative phase, supported by liquidity and continuous capital inflows. The key signal to watch next will be a decline in STH share, which would mark the start of a renewed accumulation phase led by long-term investors.”
BTC price toys with STH profit margin
As CryptoQuant reported, Bitcoin’s STH cohort currently faces a profitability hurdle.
CryptoQuant puts its aggregate cost basis at $112,500 as of Tuesday, making this week’s BTC price range the key to overall profitability.
The cost basis, also known as realized price, functions as support during bull-market drawdowns, but its loss can also flip the trend line to resistance.
CryptoQuant data indicates that this fluctuation is currently in play, as the spot price bounces above and below the STH cost basis trendline.
