CryptoQuant says BTC drop was fundamentally driven by profit-taking

Bitcoin holders’ accumulated unrealized gains were the main driver behind the latest decline, according to a CryptoQuant analysis based on on-chain data. CryptoQuant said a large Bitcoin transfer by the U.S. government helped trigger the drop by adding to selling pressure, but the core issue was that BTC holders were sitting on elevated unrealized profits. The firm said the market was already vulnerable to a decline before the large U.S. government BTC transfer, as unrealized gains had built up. When holders are sitting on sizable paper gains, even a small shock can unleash a wave of profit-taking, it added. Short-term holders sent 45,600 BTC to exchanges over the past 24 hours, including 29,100 BTC moved at a loss, which CryptoQuant said was the largest such volume since the correction that preceded June’s rally. CryptoQuant added that $74,600, the realized price for short-term holders, or their on-chain acquisition cost, could serve as a key support level, and holding that range could keep the bull-market structure intact.