On-chain data review for the week: Bitcoin hits its third new high in this cycle, and there may still be room for growth

Author: Glassnode

Compiled by: Felix, PANews

Key points:

• The Bitcoin market continued to strengthen, hitting a new high of $111,000, the third new high in this cycle.
• Investors' profit levels and selling behavior have both increased significantly, but are still lower than the previous bull market peak.
• Interactions with exchanges have increased significantly, with approximately 33% of Bitcoin’s on-chain trading volume currently conducted through centralized trading venues.
• Activity was also increasing in the derivatives sector, with open interest in both futures and options markets seeing significant growth.
• If Bitcoin continues to rise, $120,000 will become a critical area. Based on the crossover of on-chain price models in previous cycles, it is expected that selling pressure will accelerate in and around this area.

Bitcoin breaks new high

The Bitcoin market remains strong, reaching a new high of $111,000, the third new all-time high in this cycle. Historically, the price discovery phase is often followed by a short-lived sell-off as early profit takers take the opportunity to exit at new highs and reduce risk.

Bitcoin has followed this pattern so far, with the price falling back to $107,000 shortly after the initial breakout before recovering and consolidating around $108,000 for the rest of the week.

Bitcoin has outperformed most asset classes amid a tough macroeconomic backdrop and heightened geopolitical tensions, making the overall outlook uncertain. This strong performance is indeed an encouraging sign in a relatively difficult market environment.

 Source: Glassnode

Comparing the price performance of the current cycle with the previous cycles, we can see that although the total market value of Bitcoin is several orders of magnitude different, there are striking similarities in structure. The following chart shows the performance since the relative cycle low:

• 2015 to 2018 cycle: +1076%
• 2018 to 2022 cycle: +1007%
• 2022 and beyond: +656%

It is a remarkable achievement to be able to stay so close to previous cycles given the massive increase in Bitcoin’s market cap today. This shows that the scale of demand for Bitcoin keeps pace with the asset’s growth rate.

 Source: Glassnode

Evaluating accumulation patterns across wallet sizes shows that new highs tend to spark significant accumulation, which pushes the accumulation trend score toward the highest value of 1.0.

It is worth noting that the pressure to accumulate increased significantly at the all-time highs of $70,000 and $107,000 in March and November 2024, respectively. This shows that investors tend to buy in large quantities when the market enters the price discovery phase, but also shows that existing holders tend to take profits at higher prices. This "herding effect" highlights the convergence of market participants at key psychological price levels and events (such as breaking new highs).

In contrast, the last cycle, which reached an all-time high of $69,000 in November 2021, saw significant accumulation pressure both during and after the price peak. This ultimately marked a cyclical top and kicked off a lengthy bear market in 2022. While strong accumulation is generally a positive sign, it is important to recognize that overwhelming consensus behavior is not always a reliable indicator of future direction (and can, in fact, be a contrarian indicator).

 Source: Glassnode

Rising profit levels

As the market re-enters the price discovery phase, the unrealized profits held by market participants have risen significantly. As investors' profitability improves, it is generally expected that the seller pressure will increase accordingly. As prices rise, larger buyers are needed to absorb the tokens in circulation to maintain the upward momentum of the market.

Relative unrealized profits is an important tool to measure the size of the overall book profits in the market. At present, the indicator has broken through the +2σ range, which historically coincides with the market entering a frenzy phase. This environment is usually accompanied by a sharp increase in volatility and tends to be short-lived, with only 16% of trading days having book profits exceeding this level.

 Source: Glassnode

In the face of this extremely profitable situation, there has been a clear increase in profit-taking activity, as can be observed through the "volatility-adjusted net realized profit/loss" indicator.

The metric measures realized profits and losses in Bitcoin, normalizing them by comparing them periodically to Bitcoin’s growing market capitalization. Additionally, the metric is adjusted for 7-day realized volatility.

As prices broke through previous all-time highs, profit taking increased significantly, with only 14.4% of trading days seeing higher values. This suggests that profit taking has increased, but has not yet reached extreme levels.

 Source: Glassnode

This result is also reflected in the SOPR indicator, which reflects the degree of profit/loss of an asset and can be used to determine whether the selling price of an asset is higher than the purchase price. The recent all-time high has led to a significant increase in locked profits, with an average profit of +16% per coin. For investors, the profit level exceeded this level on less than 8% of trading days, indicating that investors are shifting to profit-taking activities on a large scale. However, it has not yet reached the extremely frenetic levels seen during previous price peaks.

 Source: Glassnode

Increased exchange activity

Centralized exchanges remain the main venue for trading and speculation, with daily inflows and outflows of between $4 billion and $8 billion. Exchange deposits and withdrawals compared to the total volume of transactions settled on the chain can be used as a tool to measure investors' willingness to trade Bitcoin.

The exchange volume dominance metric has been rising since hitting an all-time high of $109,000 in early 2025, and continues to climb as the market rebounds. Currently, approximately 33% of the volume on the Bitcoin network interacts with centralized exchanges.

This marks a significant increase in investor demand and trading activity, consistent with the market entering a new phase of price discovery.

 Source: Glassnode

By combining on-chain token price markings with Glassnode’s centralized exchange address tags, it is possible to estimate the average profit and loss of tokens deposited on exchanges. This provides more granular insight into investor sentiment and trading behavior that is directly related to exchange activity.

Currently, among the tokens deposited in the exchange, the average profit of the currency in a profitable state is about $9,300, while the average loss of the currency in a losing state is only $780. This difference shows that the current trading behavior is mainly profit-driven, reflecting a significant change in investor sentiment.

 Source: Glassnode

The average profit is 12 times the loss, a ratio close to the extreme levels commonly seen in the most active stages of previous bull markets. The extreme levels of the average profit-loss ratio of exchanges further indicate that the market is entering the frenzy stage of the bull market.

 Source: Glassnode

Rising levels of derivative leverage

As activity on centralized exchanges increases, it becomes increasingly important to examine derivatives markets to understand the levels of leverage that accumulate in a bull market environment.

Since hitting a local low of $74,000 in April, open interest in futures contracts has grown significantly, from $36.8 billion to $55.6 billion currently. In the past 49 days alone, this has increased by $19 billion (51%), indicating that leverage levels are rising.

 Source: Glassnode

At the same time, open interest in options contracts surged from $20.4 billion to $46.2 billion, a record high. The $25.8 billion increase was significantly higher than the growth in open interest in the futures market.

The rapid increase in options open interest reflects the growing sophistication of the investor community, which is increasingly using options contracts to execute more complex strategies to optimize their risk management and trading positions.

 Source: Glassnode

ETF inflows remain strong

In terms of spot ETFs, buyers have continued to buy since late April and are still strong. In the past week, ETFs have seen daily inflows of more than $300 million.

This massive and sustained buying from both retail and institutional investors shows that they remain confident in the asset and has been a key driver of the market’s record highs since its launch in 2024.

 Source: Glassnode

Price Discovery Exploration

As Bitcoin price moves back toward price discovery, on-chain data and technical indicators can be combined to assess market momentum and identify potential signs of overheating.

The 111-day moving average (DMA) and 200-day moving average are commonly used technical indicators to assess Bitcoin market momentum and trend strength. These technical price models can also be supplemented with an on-chain indicator, the short-term holder cost, which reflects the average purchase price of new investors in the market. Historically, this level has been a key threshold, often used to distinguish local bull and bear markets.

• 111-day moving average: $91,800
• 200-day moving average: $94,300
• Cost to short-term holders: $95,900

Bitcoin is currently trading well above these three key levels, highlighting the strength of the market’s rebound since April. It is noteworthy that these price levels are very close in value, and this convergence has formed a confluence at a key support area, which is crucial to maintain further upward momentum.

 Source: Glassnode

Additionally, MVRV (market value to realized value ratio) can be used to define price ranges, highlighting extreme deviations from average investor cost. Historically, a breakout above the +1σ range has often coincided with a long-term macro top formation.

• Realized price + 0.5σ: $100,200
• Realized price + 1σ: $119,400

Currently, the price of Bitcoin fluctuates between +1σ and +0.5σ. This shows that the market is relatively active, but Bitcoin still has room to rise further before investors realize profits to extreme levels above +1σ. Such extreme levels usually trigger large-scale profit-taking activities, resulting in a significant increase in seller pressure.

 Source: Glassnode

Finally, local overheating conditions can be assessed using the +0.5σ and +1σ standard deviation intervals around the short-term holder cost.

• Short-term holder cost + 0.5σ: $120,300
• Short-term holder cost +1σ: $135,700

Historically, the price has fluctuated within the above two ranges for 467 days and above the +1σ level for 484 days, accounting for only 17.5% of Bitcoin’s trading history. This makes entering this range relatively rare and usually acts as a ceiling for local price movements.

While the MVRV +1σ level is often associated with macro tops, the Short-Term Holder Cost Basis (STH-CB) +0.5σ and +1σ ranges are more indicative of local top formations. The combination of these models provides a reliable framework for identifying market overheating conditions.

 Source: Glassnode

Summarize

Bitcoin has reached a new all-time high of $111,000, the third all-time high in this cycle. This milestone triggered widespread activity in major market sectors, manifested in increased investor earnings and profit-taking, increased exchange interaction, significant growth in futures and options open interest, and continued growth in spot ETF buyer demand.

As the market enters the price discovery phase, the $120,000 price level appears to be a critical area and seller pressure is expected to accelerate in and around this area.

Related reading: Interpretation of six major indicators: What will the price of Bitcoin be by the end of this year?