Analysis: On-chain Indicators Suggest BTC May Be Nearing Cycle Bottom, "Profit/Loss Tokens" Converging

Odaily News glassnode data shows that approximately 11.1 million BTC are currently in a state of profit (i.e., purchase cost is lower than the current market price), while about 8.9 million BTC are in a state of loss. As the gap between the two continues to narrow, the BTC Supply in Profit vs Supply in Loss indicator is approaching a key convergence zone that has historically appeared multiple times. This indicator measures the number of wallets currently in a paper profit state versus those in a loss state. Historically, when the two gradually move towards balance, it has often corresponded with a phase of market bottoming, seen as a significant signal of market capitulation and an opportunity for long-term positioning. If the profit and loss supply further converges, it may indicate that the market is entering a historically common cycle bottom formation stage. However, a comprehensive judgment still requires consideration of factors such as macro liquidity, derivatives structure, and market sentiment. (CoinDesk)