Bitcoin’s 2024 price performance is one for the history books, with the leading cryptocurrency crossing the $100,000 mark for the first time ever. However, taking this step opened the door to another conversation: When will the market top?
As a result, several predictions regarding Bitcoin’s record price have emerged from the cryptocurrency community over the past few weeks. The latest on-chain observation suggests that the market may not have peaked or may not be close to a peak yet.
Relatively low realized profit ratio compared to previous cycles
In a recent Quicktake article on the CryptoQuant platform, an analyst under the pseudonym CryptoOnChain explained how the behavior and movements of whales could help identify the top of the Bitcoin market. The relevant metric here is the realized profit ratio, which measures the ratio at which a cohort of investors exits the market.
The “Realized Profit Rate” metric calculates the proportion of coins sold at a profit to the total trading volume. A high value for this metric indicates that the market is nearing its peak, with participants beginning to dump their assets for profit.
On the other hand, a low realized profit rate shows that fewer market players are selling their bags for profit. This often demonstrates continued investor confidence and faith in the continued price growth of a cryptocurrency.
According to CryptoOnChain, the profit rate made for various cohorts of Bitcoin whales (holding between 10 and 100, 100 and 1,000, and 1,000 and 10,000 BTC) is significantly lower than in recent cycles. As the chart below shows, it appears that the whales have not yet started to make profits.
Source: CryptoQuant
This suggests that Bitcoin whales, who are influential market entities, believe that the premier cryptocurrency has not yet reached its peak in the cycle. At the time of writing, the Bitcoin price sits just below $102,000, reflecting no significant change over the past 24 hours.
40,000 BTC withdrawn from centralized exchanges: CryptoQuant
Another data point appears to support the idea that market participants are currently expecting higher gains. Ali Martinez, a prominent crypto expert, took to Platform X to share that significant amounts of Bitcoin have left centralized exchanges over the past few days.
Source: Ali_charts/X
More than 40,000 BTC (worth approximately $3.92 billion) have been withdrawn from exchanges over the past week. This movement of assets into non-custodial portfolios indicates a growing confidence among investors, who are focused on long-term promises rather than quick short-term gains.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from Unsplash, chart from TradingView
