Market Conditions

Bitcoin's whale position has recently transitioned from an extended period of deposits at exchanges to withdrawals from exchanges. The trend shifted around the end of August, after nearly three months of overall deposits. This trend lasted about twice as long as any other period of deposits since 2023.

Whale Behavior

The 30-day moving average has been less than zero, indicating that whales have removed more Bitcoin from exchanges than sent to them. Additionally, the current number is close to the bottom side of the recent trading range, which adds credibility to this new whale behavior.

Profitability

At writing time, Bitcoin was trading near $86,200, which is well above the whale and shark cost bases at $62,100 and $67,500. At the same time, shrimp wallets were profitable through much of June's lows, where they had a cost basis around $48,000.

Market Comparison

In contrast to 2022, Bitcoin fell beneath all cohorts' realized prices, and overall losses increased the selling pressure, intensifying capitulation. Price has since recovered the break-even level of the larger cohorts as it relates to the recent downturn and reduced pressure on those in underwater positions.

NUPL Recovery

The recovery also appears in Net Unrealized Profit and Loss (NUPL). The low point of this most recent downturn in NUPL occurred at +0.09 before rising to +0.38, an increase of about 300% in just three months. NUPL has been positive since its trough, whereas it had fallen to -0.31 in the prior bear market.

Conclusion

The current structure looks healthier than 2022, but whale profit-taking could still create resistance if exchange supply rises again. Sustaining NUPL will help determine if profitability is supporting conviction rather than creating yet another distribution opportunity.