According to CryptoPotato, analysts at market intelligence platform CryptoQuant have stated that the BTC price bottoming signal will not be triggered until unrealized profit margins for short-term holders reach -10%. The report reveals that short-term holders' profit margins have approached zero, easing selling pressure, but the leading digital asset has yet to call a price bottom. BTC fell below $40,000 earlier this week for the first time since December 3, 2023, triggering roughly $230 million in short and long liquidations. The asset recorded its lowest price since the United States Securities and Exchange Commission (SEC) approved numerous spot Bitcoin exchange-traded funds (ETFs) for listing on securities exchanges.
Before BTC dropped below $40,000, the cryptocurrency had lost a significant portion of its post-ETF approval gains, plunging from roughly $49,000 to the $43,000 level. This left the crypto community anticipating a price bottom, as there will not be any rally until one takes place. The decline has also impacted miners, who have suffered an 87% decrease in fees. As of last week, short-term holders' unrealized profit margins hovered around 16%, and CryptoPotato reported two days ago that the figure may need to go below 0% before a bottom can be called and a rally expected. Although BTC has recovered slightly, CryptoQuant's analysts have set the margin at -10% as price support based on short-term holders' realized price, which is currently between $39,000 and $37,000.
While BTC has been on a downward spiral, the holdings of spot Bitcoin ETFs in the U.S. have continued to rise. At the time of writing, the products held approximately 641,000 BTC, representing significant growth since their launch on January 11. Grayscale's GBTC holds the highest amount, 536,000 BTC, while the other nine funds have collectively amassed around 104,000 BTC. BlackRock's IBIT and Fidelity's FBTC are leading the new ETFs, with holdings sitting at 44,000 and 34,000, respectively. It is worth noting that GBTC held roughly 619,000 BTC before the product's conversion into a spot ETF was approved; however, constant outflows have diminished the stash.
