Bitcoin (BTC) has been on an incredible run this year, breaking new all-time highs (ATHs) and drawing in massive institutional interest. But as with every cycle, the big question is — how close are we to the top?
The end of July gave traders a taste of volatility when Bitcoin dropped sharply, raising doubts about whether the bull market is slowing down. Now, fresh insights from the Bitcoin Net Unrealized Profit/Loss (NUPL) metric suggest the bull run might still have fuel left — but with a twist.
The July Bitcoin Dip — What Happened?
As July came to a close, Bitcoin saw a notable drop from around $123,000 to near $112,000. Analysts pointed to a mix of factors:
ETF outflows as some institutional investors took profits.
Whale selling pressure, with large holders trimming positions.
Short-term market sentiment shifts, fueled by macroeconomic uncertainty.
While this correction rattled some retail investors, many long-term holders saw it as just another healthy pullback in an otherwise strong cycle.
Understanding the NUPL Metric
The NUPL measures the overall profit or loss position of BTC investors.
Above 0 → Most holders are in profit.
Below 0 → More holders are in loss.
Historically, bull cycle peaks have aligned with NUPL hitting extreme highs, as profits become too tempting for investors to ignore.
This Cycle Is Playing Out Differently
According to Yonsei Dent, an analyst at CryptoQuant, past bull runs followed a pattern:
2017 cycle → NUPL peaked once before the top.
2021 cycle → NUPL peaked twice.
In the current cycle, NUPL has already peaked twice without the market topping out, and is now attempting a third peak with BTC trading around $120K.
What’s different?
Institutional capital from corporate BTC buys and U.S. spot ETFs is reshaping the market structure.
The cycle is moving in stepwise waves instead of overheated parabolic rallies.
Gains per rally are slightly lower, but the bull market may last longer.
Institutional Inflows & Market Stability
The growing presence of institutional investors has:
Expanded market liquidity.
Reduced extreme volatility.
Smoothed out short-term rallies.
However, as each rally brings lesser percentage gains, traders chasing huge quick profits might be disappointed.
Profit-Taking Trends
Currently, NUPL remains above 0, meaning the market price is higher than the average cost basis for most investors — increasing the incentive to sell during price spikes.
Interestingly, long-term holder profit-taking has slowed compared to July’s peak of $1B realized profits per day (Glassnode data). This could signal that experienced holders expect further upside before unloading more coins.
What This Means for the Rest of the Cycle
Upside potential remains, especially if institutional buying continues.
Short, overheated rallies may be fewer, replaced by steady climbs.
Investors should watch NUPL movements closely for signals of potential local tops.
While no metric can predict the exact peak, the combination of a recent healthy correction and sustained institutional support suggests the bull market isn’t over yet — though gains may come in smaller, more controlled bursts.
Bottom Line:
Bitcoin’s bull cycle appears to be in its later stages but not at the finish line. The July dip was more of a shakeout than a trend reversal, and NUPL data indicates there’s still room to grow. Savvy investors should stay alert, take profits strategically, and remember that in a maturing market, patience often pays more than panic.