Bitcoin Profitability Index Hits 202%: Is This Enough For A Top?

The Bitcoin Average Profitability Index is currently at 202%, indicating that the spot price is double the realized price. This on-chain indicator measures the spot price against the realized price, which is the cost basis of the average investor. When the index is above 100%, the market is in a state of profit, and when it's below, holders are carrying net unrealized losses. The index has been above 100% since last year, suggesting investors have been enjoying profits. Historically, extreme levels of the index have led to tops for the asset as investors are tempted to take profits. The analyst notes that when the index rises above 300%, investors are likely to start taking profits actively. The last two times the index surpassed 300% was during the 2017 and 2021 bull runs. According to this pattern, Bitcoin's current bullish period may not end until the indicator enters the zone above 300%. The index's current value is still a notable distance away from the level seen during the all-time high. Bitcoin is currently trading at around $67,400, up 1% over the last seven days.