According to recent data published by AltIndex.com, more than 65% of Bitcoin wallets are reported to be in profit.
This is an increase of ten percentage points compared to September last year.
Bitcoin wallets and addresses in profit
The figure refers to public addresses, not wallets, but it is possible that the same reasoning could be made for wallets.
The fact is that a Bitcoin wallet often has more than one public address, while on the addresses of crypto operators such as exchanges on the other hand, Bitcoins from different people are stored.
However, the number remains significant especially given the significant increase since last year.
In fact, AltIndex.com goes so far as to say that the number of investors who have made money by investing in Bitcoin is higher than last year. In this regard, it should be mentioned that investors who hold Bitcoin generally use multiple wallets in turn.
In light of this, it is possible to assume that the majority of those who have invested in BTC at this time are in profit.
The profit calculation
In reality, to arrive at these figures, there has not been a timely and precise calculation of how many people have purchased Bitcoin at a lower price than at present.
Typically, since all BTC transactions on Bitcoin’s blockchain are public, an estimate is made using as a hypothetical purchase price what the BTCs still on the wallets had at the time they were received.
Therefore, it is safe to say that 65% of Bitcoin addresses currently hold BTC whose total value is higher than the market value they had at the time they were received.
Obviously, only BTC still held on individual addresses are taken into account in this count, excluding those already sent to other addresses.
This is therefore not a perfect estimate, but it gives a good idea. Also because not a few people send purchased Bitcoins to their own wallets to put them in so-called self-storage.
The difference with Ethereum
The figure for ETH, on the other hand, is different.
In fact, according to Glassnode’s data, Ethereum has seen the number of addresses in profit decline year after year.
They are currently 53.2% of the total, or just over half, but as of September last year they were 55.7%. What is really curious is that during this period the price of ETH has increased by 20%.
In contrast, for Bitcoin it went from 55.7% to 65%, although by the end of 2022 they were down to about 50%. By February 2023, on the other hand, they had skyrocketed to over 72%, and in July, when the annual price peak was reached, they had jumped as high as 78%, which was the highest percentage since May 2022.
Investors in Bitcoin
AltIndex.com also reports that as of today there appear to be more than one million addresses that hold at least 1 BTC in their wallets.
In addition, Bitcoin in recent times has seen an increase in both the number of retail and institutional investors with higher investment shares.
Again according to Glassnode, the number of addresses with at least 1 BTC has increased by as much as one hundred thousand since September 2022, and the number of addresses with at least 10 BTC has increased by 5% to over 157,000.
In contrast, the number of addresses with at least 100 BTC remained virtually unchanged at 16,000, and that of addresses with at least 1,000 BTC even fell by 6%.
Note that among the latter many are addresses belonging to exchanges, so it is very likely that, simply, after the FTX failure many people withdrew their Bitcoins from exchanges to store them in non-custodial wallets.
Bitcoin: the accumulation period and profitable wallets
This data seems to confirm the hypothesis that 2023 is an accumulation year for many long-term investors.
Then again, other data also confirm that at this time it is mainly short-term traders who are selling BTC, while long-term investors are buying them.This is probably also why the number of profitable addresses has increased since September 2022.
At that time the price of BTC was less than $20,000, and later it dropped to almost $15,000. During those months it is possible that many short-term holders sold at a loss, but starting in January 2023 the trend reversed.
Already January 2023 closed with the price of Bitcoin back above $23,000, and in July it rose well above $31,000.
It certainly seems that those who bought BTC in the past 12 months were mainly those who wanted to hold them for the long term, and not traders who merely speculate on them in the short term.
Source: https://en.cryptonomist.ch/2023/09/27/majority-bitcoin-wallets-profit/