Bitcoin’s (BTC) break above the $107,000 threshold shows that the recent rally is driven by robust buying amid a consolidation just below its all-time high, Glassnode said in a May 20 report.
Despite trading around 40% higher than six weeks ago and setting a new record with the latest weekly close at $106,500, Bitcoin was stuck between $102,000 and $105,000 for the past two weeks.
The report noted that increased investor profitability and robust capital inflows indicate strength in the market.
Investor profitability improves
Short-Term Holders (STHs) have experienced financial recovery, with 71% more of their supply in profit compared to the previous month. This shift marks the second-largest profitability uptick for this cohort on record.
Glassnode’s MVRV (Market Value to Realized Value) ratios show a similar rebound. The overall Bitcoin MVRV ratio rose from 1.74 to 2.33, equating to an increase in unrealized gains from 74% to 133%.
The STH MVRV shifted from 0.82 to 1.13, moving from an unrealized loss of 18% to a 13% gain. Long-term holders (LTHs) saw their MVRV increase from 2.91 to 3.30, changing from 191% to 230% in unrealized gains.
These metrics signal widespread portfolio improvements, which Glassnode associated with elevated investor confidence.
Realized profits and market balance
As portfolios recover, many investors are securing gains. Over the past 30 days, STHs realized $11.4 billion in profit, up from $1.2 billion in the previous 30-day period. Daily realized profits peaked at $747 million as Bitcoin decisively surpassed the STH cost basis of $93,000.
The report noted a spike in the STH Realized Profit/Loss Ratio, now exceeding levels seen on 92% of prior trading days. Historically, elevated readings occur during bullish market phases or as rallies approach exhaustion.
However, the current Sell-Side Risk Ratio remains well below peak levels, indicating that profit-taking is not yet overwhelming new demand. This metric measures whether holders are locking in significant gains or losses
These indicators complement Bitcoin’s Realized Cap, which has reached a record high of over $900 billion, with a 4.2% increase over the past month. The metric aggregates the total capital stored in the network based on the price at which investors moved each coin last.
This steady accumulation signals that the market is absorbing profit-taking without major dislocation.
Glassnode concludes that Bitcoin is experiencing improved investor conditions, with meaningful capital inflows, reduced unrealized losses, and profit-taking activity indicative of a healthy bull market phase.
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