In Bear Markets, Most Addresses are Unprofitable

The data shows that in previous bear markets, most addresses were not profitable.

  • This data from IntoTheBlock indicates that just over half of all Bitcoin addresses are currently in the red, meaning that they are sitting on losses. However, 45% of addresses are in the green, indicating that they are holding unrealized gains. The remaining addresses are roughly at break-even.
  • As bitcoin's price continues to rise, more and more addresses are becoming out-of-the-money. IntoTheBlock defines out-of-the-money addresses as those that acquired coins at an average price higher than bitcoin's going market rate of $16,067. This means that these addresses are now sitting on losses.
  • Lucas Outumuro, head of research at IntoTheBlock, believes that the bearish momentum looks overdone. He believes that the market is currently undervalued and that there is potential for upside in the near future.
  • The current bear market in cryptocurrency appears to be following the same pattern as previous bear markets, with the majority of addresses becoming increasingly "out of the money." However, it is unclear at this point how long this trend will continue, or whether it will eventually lead to a
Previous bear markets ended with most addresses being out of the money. (Source: IntoTheBlock) (IntoTheBlock, CoinDesk)
It's no secret that bear markets are tough on everyone involved in the cryptocurrency space. But it's important to remember that previous bear markets have eventually ended, and most addresses have been in the money again.
  • It's interesting to note that the percentage of out-of-the-money addresses stands at 55% even though Bitcoin bottomed near $3,200 around the same time. This just goes to show that there's still a lot of potential for Bitcoin to grow, even after a bear market.
  • The percentage of addresses out of the money rose to 62% during the depths of the 2015 bear market. However, this number has been steadily declining since then and is now down to 32%. This shows that more and more people are becoming bullish on Bitcoin and are confident in its future price movements.
  • There is no guarantee that past data will repeat itself in the future, and the recent collapse of crypto exchange FTX may bring more pain to the market. Those who have invested in cryptocurrencies should be aware of the risks involved, and should only invest what they can afford to lose.