A recent study conducted by Into the Block reveals that the vast majority of addresses for the leading cryptocurrencies are at a loss. The only exceptions are Bitcoin and Chainlink.
After surviving the bear market of 2018, it would be safe to assume that the majority of cryptocurrency is at a loss. Now, we have definite proof that this is the case.
Bitcoin Holders Are Profiting
A study by Into the Block revealed that the situation is far worse than one might expect. The investigation looked at the average prices for when tokens were acquired for all the addresses of a particular cryptocurrency. From this, it was calculated what percentage of holders were currently in profit.
The study found that 79% of Bitcoin addresses are still in profit, the highest in the entire cryptocurrency market. Chainlink (LINK) comes in second with 56% of addresses being in profit.
What’s most shocking is that the vast majority of leading altcoin holders were at massive losses.
- 74% of Ethereum (ETH) addresses were at a loss.
- 75% of Cardano (ADA) addresses were at a loss.
- 94% of Icon (ICX) addresses were at a loss.
- 95% of Zcash (ZEC) addresses were at a loss.
For any address with a positive balance, @intotheblock identifies avg price at which tokens were acquired, indicating if the address is at profit or loss.
— Alex Krüger (@krugermacro) August 24, 2019
Altcoin Holders Are Largely in the Red
The results underscore the sobering fact that most cryptocurrency investors have not recovered at all from the 2018/19 bearish winter. In fact, we are still only in the early beginnings of the uptrend, which seems to have been a boost for Bitcoin holders. The fact that 74% of all ETH addresses are bagholders should also be a serious cause for concern for the second-largest cryptocurrency.
Analyst Jesus Rodriguez said on Twitter that the data was compiled through machine learning. The algorithm was able to differentiate between transfers, payments, exchange withdrawals, and other kinds of transactions to pinpoint exactly when each address likely bought the cryptocurrency it is holding.
We use machine learning classifiers to differentiate between various groups of transactions ex : transfers , utxo etc. is not exact but statistically accurate
— Jesus Rodriguez (@jrdothoughts) August 24, 2019
Yet, there’s a hidden nugget of good news in all his data: despite most altcoin addresses being at a loss, they don’t seem to be mass selling. That likely indicates that we, indeed, have bottomed out if that fact was not obvious already.
What do you think one can extrapolate from this data? Let us know your thoughts on this study in the comments down below.
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Images are courtesy of Shutterstock, Twitter.