Bitcoin’s On-Chain Shenanigans: A Balancing Act of Profits and Demand

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Hey there, fellow crypto enthusiasts! Guess what? Bitcoin has been chillin’ above $104K like a boss, while the summer months bring a whole lotta nothin’ to the crypto market. Yep, you heard that right!

But don’t worry, this price consolidation ain’t no cause for alarm. In fact, it’s a sign of a balanced market, as on-chain metrics show neither excessive profit-taking nor aggressive accumulation. 🤑

Realized Profits Stay Subdued

According to CryptoQuant’s latest update, the 7-day moving average of realized profits is holding below $1 billion, which is comparable to levels observed during the October 2024 correction. Even during Bitcoin’s surge to a new all-time high earlier this year, realized profits failed to match the peaks seen in January 2025. This means investors ain’t in a hurry to cash out, and that’s keeping the market stable.

However, what’s preventing a stronger bullish breakout is the apparent weakness in demand. The ratio of newly issued supply to dormant supply (inactive for over a year) shows demand. While still positive, it has been steadily declining since the local high in May. A ratio above zero typically reflects healthy demand, but the gradual drop suggests that buying interest is cooling off. Despite this, the demand remains sufficient to absorb the existing selling pressure, which is keeping the market stable.

Overall, Bitcoin appears to be in a state of equilibrium, where moderate realized profits and slowly waning demand offset each other – an environment that supports consolidation rather than a sharp directional move in the near term.

While on-chain activity reflects a balanced market, sentiment indicators are beginning to tilt bearish.

A Classic Contrarian Buy Signal Emerges

Santiment’s latest data shows a spike in retail bearish sentiment toward Bitcoin. Interestingly, this trend often signals a potential rebound. Currently, there are just 1.03 bullish comments for every bearish one – levels not seen since April 6th, when fear peaked amid initial tariff-related market reactions. Historically, such negative sentiment among traders has preceded upward price moves, as markets tend to act contrary to retail expectations.

Similar fear in early April marked a strong buy opportunity, which suggests current conditions could offer a repeat setup for crypto bulls. So, if you’re feeling a bit bearish, maybe it’s time to reconsider your stance and embrace the contrarian buy signal! 🐻💸

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2025-06-20 10:50