The Performance of Major Altcoins in the Current Bull Market
As the current bull cycle progresses, several large-cap altcoins have experienced notable surges, with Solana and XRP emerging as top performers. Meanwhile, Ethereum, often hailed as the ‘king of altcoins,’ has not lived up to expectations, displaying a lackluster performance over the past year.
Understanding the Current State of Ethereum Investments
Recent on-chain data reveals that a substantial portion of Ethereum (ETH) investors are experiencing losses, largely due to a market downturn affecting the broader cryptocurrency landscape. This article delves into the percentage of Ethereum’s supply currently in a loss-making position and examines the potential implications for its price trajectory.
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Assessing the Profitability of ETH Tokens
In a detailed analysis posted on the X platform on February 8, Santiment, a leading on-chain analytics firm, highlighted a consistent increase in the number of Ethereum tokens in a loss over recent weeks. Key metrics in this analysis include the ‘percent of total supply in profit’ and the ‘total supply in profit.’
The ‘supply in profit’ metric calculates the total number of tokens last transferred at a price lower than the current market value. Meanwhile, the ‘percent of total supply in profit’ reflects the percentage of a cryptocurrency’s total supply held at a price exceeding the original purchase price, indicating the ratio between the supply in profit and the circulating supply.
Santiment’s data indicates that Ethereum’s market capitalization has dipped by over 36% since peaking at $4,016 in mid-December. This persistent decline in price has significantly reduced the number of ETH tokens in profit since their initial mining date.
Current Metrics and Market Sentiment
According to Santiment, the Ethereum tokens currently in profit account for approximately 97.7 million, marking the lowest level since November 4, 2024. Concurrently, the ratio of the total ETH supply in profit is at 65.5%, the lowest since October 2, 2024, and a sharp decline from 97.5% in early December.
In their analysis, Santiment noted:
The sentiment around Ethereum has been predominantly negative due to its underperformance compared to other major altcoins. With prevailing fear, uncertainty, and doubt (FUD), alongside retail traders offloading their tokens, unexpected market rebounds could occur once the crypto markets stabilize.
When a smaller percentage of a token’s supply is profitable, steadfast long-term holders tend to dominate the market. This situation suggests that most FUD-driven retail traders have exited, thereby alleviating downward pressure and creating a potential platform for recovery.
Ethereum’s Current Price Dynamics
At the time of writing, Ethereum’s price hovers just above the $2,600 threshold, marking an over 2% increase in the past 24 hours.
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