Bitcoin investors might hit the jackpot if they utilize its 'unrealized' profits

The Bitcoin price has risen back above US$21,000 and has probably triggered a short-term rally among all cryptocurrencies. But certain experts believe that September could actually be the toughest month for the flagship cryptocurrency. With rising economic conflicts in the US and abroad markets, the global stock market continues to dwindle, causing Bitcoin and other cryptocurrencies to plummet over time. Market analysts believe that BTC will continue to experience more volatility and witness rallies but in a downward trend. This Bitcoin price action has divided the market into two halves, where initially comes those investors who are holding up their investments to reap the profits when the market takes off, and the other part consists of those investors who are strategizing to sell off their investments. But for those, who are still strategizing and have yet not sold off their BTC tokens, there is good news! Data suggests that about 50% of BTC holders have been in positive or unrealized profit territory, based upon an on-chain metric known as Net Unrealized Profit or Loss, or NUPL. Hence, if you have yet not sold off your BTC tokens, you are probably in for some more profits.

What does Bitcoin Unrealized Profit/Loss really mean?

Basically, 'unrealized' is a metric that holds immense importance for investors who have not yet sold their tokens. It is a measure of whether or not the investors would stand to gain or lose at their current average market price. Just before Bitcoin surged, about 47% or more than half of the BTC investors had been experiencing profits, and currently, as the token surged, the number has risen even higher. NUPL, which is a useful tool utilized to analyze market sentiments around Bitcoin says that for the token's unrealized profit or loss, whenever the number is positive, investors generate unrealized profits, whereas, when it's negative, more hold unrealized losses.

Bitcoin initially fell due to several macroeconomic factors such as rising inflation, geopolitical crises, and rising interest rates, these triggers continued to drive added short-term volatility in the crypto and stock markets. The crypto market still has a correlation with the stock market, which makes it even more intertwined with mainstream global financial factors.

Bitcoin is still losing investment appetite

Glassnode says that the number of Bitcoin addresses actually holding BTC tokens has decreased over the period of 7 days. This indicates that investors are trading and holding more Bitcoin and believe the crypto market will surely gain value over time. By shifting their tokens from exchanges and into storage, they can avoid potential losses if the market were to crash again. As the BTC price has been sharply struggling to regain back its lost value, over the past few months, it has certainly yielded some profits, and now only 40% of the investors lay in red. Nevertheless, the estimated unrealized profit might drive potential investors on becoming bullish on BTC and aid the price to surge eventually.