Here’s How Ethereum Holder Profitability Has Changed During the Recent Downturn

Recent data reveals that only 61% of Ethereum holders are currently in profit, a significant drop due to the ongoing bearish trend.

This shift is measured using the “ Historical In/Out of the Money ” indicator, which tracks the percentage of holders who have gained, lost, or broken even based on their average acquisition price.

When the price of Ethereum falls below an investor’s cost basis, they are considered “out of the money” (in a loss), while those whose acquisition price is lower than the current market value are “in the money” (in profit). The metric has dropped notably from earlier this year when over 90% of Ethereum holders were in profit during a bullish rally. The recent market downturn has pushed this figure down to 61%.

Historically, when a large portion of investors are in profit, the likelihood of selloffs increases, often leading to market tops. Conversely, bottoms tend to form when more holders are at a loss, as profit-taking sellers diminish.

In past bear markets, this indicator dropped even further. During the 2022 bear market, only 46% of holders were in profit at the lowest point, while in 2018, the figure plunged to just 3%. The recovery following the 2018 downturn even saw profitability levels briefly dip under 10%.

If the current market correction follows a similar pattern to previous cycles, Ethereum’s profitability may continue to decrease, possibly approaching the 46% mark observed during the last major bear market.