A significant portion of Bitcoin's supply is now operating at a loss, indicating the market is closer to historical bear-phase conditions than a confirmed bull trend. According to analysis of unspent transaction outputs, 43% of Bitcoin supply is currently underwater, with only 57% in profit.
Historically, a profit level above approximately 75% has signaled a confirmed bull trend. Conversely, a rise in supply held at a loss often deepens corrections and resembles bear-market structures. With Bitcoin's profit supply at 57%, conditions are described as resembling deep bear market phases.
While signs of stabilization and consolidation exist, the market may move lower to further shake out long-term holders, potentially pushing the supply in loss toward 45%, a level seen in previous bear markets.
The broader macroeconomic backdrop is also weighing on Bitcoin. A rally in oil prices, driven by geopolitical tensions, adds pressure to risk assets. Higher oil prices contribute to inflation expectations and financial market stress, creating an unfavorable environment for speculative assets like Bitcoin.
This confluence of on-chain data and macro concerns suggests Bitcoin is drifting toward territory where a bear trend becomes more difficult to dismiss. The key question is whether Bitcoin can regain profitability for a larger share of its supply or if macro stress and continued holder selling will drive it deeper into loss territory.
At press time, BTC traded at $67,730.
