Bitcoin holders are cashing out, just not the way they did at prior market tops

Bitcoin's recent surge has some traders liquidating the coins to take profits on their holdings. But the pace of this operation is far slower than at prior market peaks, a positive sign for the market.

BTC has rallied by 44% to nearly $85,000 this quarter, its best performance since the final three months of 2024, according to CoinDesk data. The strong rise comes after three straight quarters of red ink.

Naturally, some are taking profits, as evidenced by the net realized profit/loss metric. It records the dollar gains locked in when coins actually move on-chain at a price above the last price at which they changed hands.

Analysts treat that prior transfer as a cost basis: if a coin bought or last spent at $40,000 is later sent or sold at $84,000, the $44,000 difference is booked as realized profit.

Investors have recently realized $2.4 billion in profits after the price surge, according to data tracked by Bitfinex.

"BTC holders just realised $2.4bn in profits. At prior market tops, daily realized profits ran between $7bn and $10bn," Bitfinex said on X.

In the meantime, ETFs continue to attract money and have now registered a net inflow of $2.84 billion in six days. That's more than profits realized by holders. Further, ETFs are now up nearly $800 million in net inflows for the year.

Ether too is giving bullish signals. According to Bitfinex, around 410,000 ETH has come off exchanges in a month, while U.S. spot ether ETFs have attracted $680 million in investor money across four sessions. That is painting a bullish picture for the near term.

As of this writing, bitcoin, ether and other majors did not show any signs of weakness in the wake of the $452 million Bitget hack.

In traditional markets, rallies in the Dollar Index and Treasury yields appear to have stalled for now, a relief for risk assets. However, oil volatility stays high amid confusing headlines related to the Iran war. Stay alert!