Bitcoin Profit Taking Indicator Drops from 10 Billion to 3 Billion
Although the Bitcoin market has been highly volatile recently, some analysts remain optimistic about the future.
According to Cointelegraph, CryptoQuant analyst Percival pointed out that while Bitcoin has risen 12% over the past three weeks, the net realized profit of long-term holders has significantly decreased from 10 billion USD on November 25 to 3 billion USD on December 14.
Percival stated that this indicates long-term holders have realized most of their profits at this stage, and the market is ready for further increases.
However, independent trader Yonsei Dent cautioned investors to pay attention to the changes in the Coinbase premium. This indicator has been continuously declining since early December, diverging from the Bitcoin price trend, indicating weakened demand from U.S. investors and suggesting a potential fatigue in mid-term upward momentum.
Analysts remain optimistic about the future, predicting a breakthrough in Q1 2025.
Another cryptocurrency trader, Daan Crypto, noted that Bitcoin's current trend is similar to last year. He expects the market to continue to maintain a consolidation phase at the end of 2024, with a real breakthrough occurring in Q1 2025.
However, Bitwise's Head of Research for Europe, Andre Dragosch, warned that the strengthening U.S. dollar index may be one of the biggest risks Bitcoin faces currently.
He explained that the appreciation of the dollar is usually associated with a contraction in global money supply, which is generally unfavorable for Bitcoin and other crypto assets. But he also pointed out that on-chain data shows Bitcoin remains very strong, especially as exchange balances continue to decline, supporting the hypothesis of Bitcoin supply shortage.
