80% of Ether Supply in Profit Leads of Fears of a Price Drop

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Crypto analytics firm Glassnode reported 80% of the supply of the second largest cryptocurrency by market cap was in profit on June 10.

According to crypto analytics firm Glassnode as of June 10, more than 80% of the Ether supply was in profit — leading to fears of a price drop. 

Glassnode posted a chart showing that the percent of Ether (ETH) in profit had hit 80% for the third time in a year, commenting: “Last time the Ethereum’s supply in profit was significantly above 80%, ETH was priced at around $700.” (The key word there is “significantly” as Ether hasn’t been around $700 for some time).

The percent of #ETH supply in profit is hovering at 80%.

It is the third attempt within a year to break this level.

Last time the #Ethereum‘s supply in profit was significantly above 80%, $ETH was priced at around $700.

Live chart: https://t.co/BsX5avJV2X pic.twitter.com/QR82efHyqq

— glassnode (@glassnode) June 9, 2020

The graph shows what percentage of the ETH supply is currently valued higher than at the time it was last moved. When the metric neared the 100% mark on two other occasions in the past year, it was followed by a steep correction.

The firm clarified the data only covered Externally Owned Accounts (EOAs) and not wallet contracts.

Investors sell at high prices

Cointelegraph reported in May an ETH price between $250–$252 could be the first substantial indicator for bullish momentum, but having 80% or more of the supply in profit has historically been unsustainable.

Though the price of ETH rallied to $250 on June 10 as the metric rose above 80%, the second-ranked cryptocurrency has been on a downward trend since that time, falling 8.4% to $229 on June 11.

ETH price

ETH price

However the recent Bitcoin (BTC) volatility no doubt played a major role in the price of ETH going down in the past day or so. Sell-offs triggered an $800 drop in BTC nearly the same time ETH experienced a similar percentage drop.