The current bull cycle is different from past seasons in many ways. For starters, bitcoin (BTC) has recorded new all-time highs (ATH) every now and then. This has raised speculation about when the market will reach its peak and begin a bear run.

An analyst at the market research firm CryptoQuant has predicted that the bull run may last longer, but with a catch. This prediction stems from data derived from the Bitcoin Net Unrealized Profit/Loss (NUPL) metric, which measures the overall profit or loss status of BTC investors.

Is The Market Near a Top?

According to Yonsei Dent, an NUPL value above 0 indicates that more bitcoins are in profit than in loss. The more the value climbs, the stronger the incentive for investors to take profit, leading to increased selling pressure.

Past bull cycle tops have coincided with peaks in the NUPL. CryptoQuant found that the metric hit one peak throughout the 2017 bull run; that figure doubled in the 2021 cycle. However, the current cycle has not come to an end, but the NUPL has already hit two peaks. Yonsei said the indicator is attempting a third peak, with BTC at its current price of $120,000.

The analyst noted that, unlike past cycles, this bull market is moving in “stepwise waves.” This shift in momentum can be linked to the increasing inflow of institutional capital from corporate BTC acquisitions and United States spot exchange-traded funds (ETFs).

Although the rising institutional participation has increased the market size and liquidity and improved stability, the percentage of profit during each rally is gradually declining. Therefore, the bull market may last longer than previous cycles, but with lesser gains for investors.

Yonsei insists that the chances of the market seeing sharp, short-term overheated rallies during the rest of the cycle could be lower.

NUPL Stays Above 0

Currently, the NUPL remains above 0, indicating that bitcoin’s market price is higher than the average price at which investors, especially short-term holders, purchased their assets. This increases the chances of increased selling pressure when prices climb higher.

Meanwhile, profit-taking among long-term Bitcoin holders has slowed down from a high trend witnessed weeks ago. On-chain analytics firm Glassnode recently disclosed that the seven-day moving average of long-term holder realized profits has fallen from the $1 billion per day seen in July.