Concerns Rise Among Investors as Bitcoin Approaches $70,000 with $7 Billion in Unrealized Gains
Bitcoin enthusiasts have been eagerly anticipating the moment when Bitcoin surpasses the $70,000 mark, a scenario supported by the substantial amount of unrealized gains currently in play – a clear indication that BTC holders are holding onto their investments, expecting further value appreciation.
Recent analysis by CryptoQuant has revealed that the total value of unrealized profits in Bitcoin has now exceeded $7 billion. This statistics not only signifies a strong HODL sentiment among investors but also reflects their optimistic outlook towards future price escalations, albeit with a warning of a potential significant pullback if profit-taking activities resume.
If and when Bitcoin holders decide to cash in their profits, the ensuing sell pressure could mirror the precarious situation witnessed at the tail end of July, resulting in a rapid price decline. Despite this looming threat, Bitcoin has thus far managed to maintain its upward trajectory on the charts.
As of the latest update, Bitcoin is currently trading at $68,350, edging ever closer to the coveted $70,000 milestone. The cryptocurrency is also inching towards the next resistance bracket situated between $69,400 and $71,500.
Bitcoin Exchange Flows Hit 2024’s Lowest Levels
Monitoring Bitcoin exchange flows can shed light on the recent bullish momentum observed in the crypto market.
After a notable surge in exchange activity between October 13 and 16, both inflows and outflows have now tapered off to their lowest points this year.
Recent data indicated that a net total of 3,760 BTC was withdrawn from exchanges over the past 24 hours, although approximately 3,940 BTC was deposited into these trading platforms, resulting in slightly higher inflows than outflows.
The volatility in exchange flows suggests that Bitcoin might be gearing up for another round of price turbulence. The question remains whether this surge will bring about bullish or bearish sentiments, with further cues potentially coming from address flow dynamics.
An intriguing pattern emerged as the number of active sending addresses dwindled since mid-October. For example, the count dropped from 860,161 addresses on October 15 to 478,148 addresses by October 18.
In contrast, receiving addresses saw a rise from 379,545 on October 13 to 625,308 addresses on October 18. Not only were there more addresses acquiring Bitcoin compared to those offloading it, but the growth in receiving addresses coincided with a pullback in sending addresses.
The address movement data indicated a shift in the market dynamics, showcasing reduced selling pressure despite the recent price surge. While the prevailing trends hint at a potential upward push for Bitcoin, the likelihood of an unexpected surge in sell-offs remains a distinct possibility.