On-chain data shows that Bitcoin investors’ profit-taking has observed a huge decline since last month’s top, a sign that could be positive for BTC.

Bitcoin Realized Profit To Exchanges Now Down To $277 Million Per Day

According to data from the on-chain analytics firm Glassnode, trader profit-taking in the Bitcoin market has cooled off significantly during the last couple of weeks.

For the purpose of tracking profit-taking, the analytics firm has made use of the “Realized Profit to Exchanges” indicator. This metric, as its name suggests, measures the total amount of profit that the investors are harvesting or ‘realizing’ through transactions to centralized exchanges.

Profit is said to be realized on the blockchain when a token with a previous transaction price less than the current spot value is moved. Not all transfers on the network correspond to a trade, however, which is why Glassnode has specifically restricted the metric to exchange inflow transfers.

Holders generally transfer their coins to these platforms when they want to participate in selling-related activities, so the amount of profit realized by exchange inflows is more likely to give an accurate picture of the profit-taking situation in the sector.

Now, here is the chart for the indicator shared by the analytics firm that shows the trend in the 7-day moving average (MA) of the Bitcoin Realized Profit to Exchanges over the last couple of years:

The 7-day MA value of the metric appears to have seen a decline in recent days | Source: Glassnode on X

As displayed in the above graph, the 7-day MA Bitcoin Realized Profit to Exchanges registered a sharp surge last month as BTC exploded to new highs. This suggests that the investors were harvesting a large amount of profits at the rally highs.

Note that the version of the indicator used here is the “ Go to Source to See Full Article
Author: Keshav Verma