Bitcoin Supply in Profit Nears Historic Bear Market Lows

TLDR

• Bitcoin supply in profit has declined to about 11.2 million BTC, nearing levels seen in the last bear market.
• Data shows that around 8.2 million Bitcoins are currently at a loss, according to onchain analytics firms.
• One analyst said the current readings resemble prior bear market undervaluation conditions.
• Another analyst argued that the metrics reflect rising market stress rather than a confirmed bottom.
• Bitcoin has fallen about 52% from its cycle high, which remains smaller than past bear market drawdowns.

Bitcoin (BTC) market data shows profit and loss supply metrics moving toward prior bear market ranges. CryptoQuant and Glassnode figures indicate shifting holder positions as prices remain below cycle highs. Analysts disagree on whether the data reflects undervaluation or growing stress across the market.

Bitcoin supply data nears prior bear cycle ranges

CryptoQuant analyst “Darkfost” reported that about 11.2 million Bitcoin remain in profit. He compared that figure with 9 million Bitcoin recorded at the previous bear market low. He said the gap shows Bitcoin supply trends are approaching past bear conditions.

Glassnode data shows roughly 8.2 million Bitcoin currently sit at a loss. Darkfost said the last bear market saw about 10.6 million Bitcoin in losses. He stated, “This suggests that the market is reaching a level of undervaluation comparable to the previous bear market.”

Analysts split on market stress and downside risks

Andri Fauzan Adziima, research lead at Bitrue exchange, disputed the undervaluation view. He said the data signals “increasing market stress, not immediate undervaluation.” He added that prior capitulation phases showed deeper pressure across supply metrics.

Adziima said supply loss exceeded 50% during the 2022 bottom. He also said the supply in profit fell to around 45% or lower at that time. He pointed to net unrealized profit and loss and MVRV ratios reaching extreme readings during that period.

He stated, “Current data points to early or mid bear transition.” He projected a potential structural bottom near $55,000. However, he said more downside or consolidation could occur before a full reset.

Market data shows Bitcoin price has fallen about 52% from its cycle high. Previous bear markets recorded drawdowns between 77% and 84% from their peaks. These figures show the current decline remains smaller than earlier cycles.

Bitcoin author Timothy Peterson addressed currency trends on X. He said Bitcoin “tends to struggle when the dollar is strong, and the Chinese yuan is weak.” He linked this pattern to tighter global liquidity conditions.

Peterson explained that higher US dollar yields attract capital into cash and bonds. He said cautious sentiment rises as China eases policy. He added that recovery depends on falling US interest rates.

He stated that the dollar yield must lose its appeal for conditions to shift. He said this scenario is unlikely before the second half of 2026 or 2027. Bitcoin traded below its prior peak as these macro factors persisted.

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