Bitcoin Supply in Profit Signals Market Shift

[Chawla Solutions]

One of the most telling on-chain indicators for Bitcoin’s market health is Supply in Profit (%). This metric tracks what portion of the total BTC supply is currently held at a profit, offering insight into investor sentiment and cycle positioning. Historically, readings above 80% align with euphoric bull market phases, while levels below 55% often mark deep bear markets or cycle bottoms. The zone in between is where transitions happen.

Right now, Bitcoin’s Supply in Profit sits at 68.85%. On its own, that number doesn’t scream panic. However, the context matters. This level wasn’t reached after a sudden drop — it has declined steadily over several months. That slow erosion is a classic sign of market fatigue, often seen in the later stages of a bull cycle rather than during a short-lived correction.

As profitability shrinks, investor behavior changes. Long-term holders tend to stay patient, but shorter-term participants become more cautious. Risk appetite fades, leverage is reduced, and rallies struggle to gain follow-through. This internal weakening is happening while macro pressure remains elevated, with geopolitical uncertainty and capital rotating toward traditional safe-haven assets.

Together, these forces suggest Bitcoin may be entering an early transition phase between bull and bear markets. This doesn’t imply an immediate collapse, but it does argue for realism. Periods like this reward disciplined positioning, careful risk management, and lower expectations for fast upside.

Market cycles rarely end with a single dramatic event. More often, they fade slowly — and Supply in Profit is quietly showing that process in motion.