More Losses Than Gains for Bitcoin Despite Recovery to $79.000

Although 69% of the Bitcoin supply is now in profit, the situation remains a different story from a capital perspective. Of the approximately $1 trillion in invested capital, $617 billion is currently at a loss, against $447 billion in profit. Analyst Darkfost states that the market is approaching a crucial tipping point where investors must choose: withdraw capital without loss, or remain invested in the hope of profit.

Bitcoin is available at OKX and Bybit.

In brief:

• 69% of the Bitcoin supply is currently in profit, but $617 billion of invested capital is still loss-making
• The market is approaching a balance point where investors are faced with a choice regarding their loss-making positions
• The loss-making capital previously reached a historic record of $935 billion, illustrating the severity of this correction

Supply in profit does not tell the whole story

That 69% of the Bitcoin supply is currently in profit sounds positive. But Darkfost points out that this picture is distorted by the large amount of old, barely traded Bitcoin that has been held for a long time. During the current cycle, the supply in profit stood below 50% for only 15 days, notably in July.

According to the analyst, it is plausible that the 50% threshold will barely be breached in the future, precisely because of the growing share of long-term holders with low purchase prices.

Capital tells a different story

Anyone who looks not at supply but at invested capital will see a different reality. With a total market value of approximately $1 trillion, $617 billion is still in the red, while $447 billion is in profit. The Bitcoin price was trading around $79.300 at the time of the analysis.

Darkfost describes this as a real test for the market: investors who can just break even after a long correction face the choice of exiting or staying put in the expectation that Bitcoin will recover further.

Historic record of loss-making capital

Although some argue that this cycle saw less of a major capitulation than previous bear markets, Darkfost qualifies that view. The loss-making capital previously reached a historic record of $935 billion, which in his view demonstrates how severe this correction was compared with previous downward cycles.

In the coming weeks, partly in light of the expectations for September, it will become clear whether confidence is strong enough to keep investors in the market once they have the opportunity to sell without a loss.