Bitcoin Sees 97% of Supply in Profit as Leverage Risks Rise, Warns Glassnode
Bitcoin continues to dominate the headlines as the world’s largest cryptocurrency records another major milestone. According to blockchain analytics firm Glassnode, nearly 97% of Bitcoin’s circulating supply is currently in profit, thanks to the recent rally driven by strong inflows into Bitcoin exchange-traded funds (ETFs).
However, analysts are cautioning that while the surge signals robust demand and growing institutional interest, rising leverage and “crowded call positioning” could introduce short-term fragility into the market.
Nearly All Bitcoin Holders Are in Profit
Glassnode’s latest data reveals that the recent rally has lifted nearly all Bitcoin supply back into profit territory.
“Building on the accumulation trend, Bitcoin’s rally to a new all-time high has lifted nearly all circulating supply back into profit,”
the firm stated in its report released Wednesday.
Historically, such elevated profit levels often precede a phase of market consolidation, as investors take advantage of gains. However, Glassnode noted that realized profits remain relatively contained, indicating an orderly rotation rather than mass distribution pressure.
In simple terms, investors appear to be strategically taking profits and reallocating their holdings instead of panic-selling — a sign of a healthy and mature bull market supported by sustained demand.
Key Support Levels and Possible Pullback to $117,000
Glassnode’s analysis also highlighted potential structural support zones using its “Cost Basis Distribution Heatmap.” The firm identified notable support between $121,000 and $120,000, with stronger demand likely around $117,000, where approximately 190,000 BTC were last acquired.
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| Source: Glassnode |
“While price discovery phases inherently carry the risk of exhaustion, a potential pullback into this region could invite renewed demand as recent buyers defend profitable entry zones,”
the report noted.
This makes the $117,000 zone a key area to watch, potentially marking a stabilization point and a launchpad for renewed bullish momentum if prices correct in the short term.
Institutional Demand Surges Amid ETF and Futures Boom
Beyond price levels, institutional activity remains a major driver of Bitcoin’s momentum. Glassnode reported that surging volumes in Bitcoin futures and spot ETFs confirm significant institutional appetite.
However, this rapid growth in leveraged trading could also increase short-term market vulnerability. Elevated funding rates and open interest in derivatives often precede sharp liquidations when volatility spikes.
Data from CoinGlass shows that U.S.-based spot Bitcoin ETFs have attracted over $2.5 billion in inflows in just the first three days of this week — including their second-largest single-day inflow since launch. Such figures underscore how traditional finance continues to embrace Bitcoin as a viable investment asset, even as volatility remains a concern.
A Mature Yet Sensitive Uptrend
Glassnode’s analysts concluded that Bitcoin’s current on-chain signals point to a “robust yet maturing uptrend” — one that remains fundamentally supported by institutional demand, but increasingly sensitive to profit-taking and leverage resets as the cryptocurrency navigates its latest price discovery phase.
At the time of writing, Bitcoin (BTC) had pulled back slightly from its Wednesday high of $124,000 to trade just below $122,000. Despite the short-term risks, market sentiment remains largely bullish, with traders eyeing new all-time highs if the market manages to absorb profit-taking pressure and stabilize above key support zones.