What is this?

Supply in Profit/Loss measures what percentage of the total Kaspa circulating supply is currently worth more (in profit) or less (at loss) than the price at which it was last moved on-chain. This is one of the most powerful on-chain sentiment indicators available, analogous to Glassnode's "Percent Supply in Profit" metric popularized in Bitcoin analysis. It provides a direct, objective measurement of how many holders are sitting on unrealized gains versus unrealized losses.

The metric works by treating each UTXO (Unspent Transaction Output) as a discrete "cost basis" entry. When a UTXO is created in a transaction, the market price of KAS at that block's timestamp becomes its acquisition price. If the current market price is above that acquisition price, the KAS in that UTXO is "in profit." If below, it's "at loss." By summing all UTXOs in each category, we get the total supply in profit and total supply at loss.

This metric captures the aggregate psychology of the market. Unlike exchange-based indicators that only reflect active traders, supply in profit/loss accounts for every coin in existence — including those held long-term in cold storage, mining rewards that have never been sold, and dormant wallets. It represents the full spectrum of market participants and their collective financial position.

How to use this data

Extreme readings in either direction are powerful contrarian signals. When more than 95% of supply is in profit, the market is in a state of euphoria where nearly everyone is a winner. Historically across cryptocurrencies, this condition precedes distribution phases — holders who have been waiting for profit begin to sell, creating overhead supply pressure. This doesn't mean an immediate crash, but it signals elevated risk of a correction.

Conversely, when more than 50% of supply is at a loss, the market is in deep pain. Many holders are underwater and the temptation to capitulate (sell at a loss) is high. Paradoxically, this condition often marks the best accumulation opportunities — those willing to sell have largely already done so, selling pressure is exhausted, and the remaining holders are committed long-term. Historically, buying when supply-at-loss exceeds 50% has produced exceptional returns over 12-month horizons.

For Kaspa specifically, pay attention to how quickly this metric shifts during price moves. Because Kaspa has a young UTXO set (the network launched in 2021) and active on-chain movement, the supply in profit can swing dramatically with relatively small price changes compared to Bitcoin. Rapid shifts from high-profit to high-loss indicate that recent buyers are quickly becoming underwater — a sign of a sharp reversal that may find support at lower price levels.

How it's computed

The computation begins with a full scan of Kaspa's UTXO set — every unspent transaction output currently existing on the network. For each UTXO, we look up the block in which it was created, determine that block's timestamp, and then query the historical KAS/USD price at that exact time. This gives us the "realized price" or cost basis for that specific batch of coins.

We then compare each UTXO's realized price against the current market price. If current price is greater, the UTXO's KAS amount is added to "supply in profit." If current price is lower, it's added to "supply at loss." The percentages shown are these totals divided by total circulating supply. The scan is performed hourly to capture meaningful changes while managing computational load.

Important caveats: this method assumes the price at UTXO creation is the holder's actual cost basis. In reality, some UTXOs are created by internal transfers (same owner moving coins between addresses) where no economic transaction occurred. Additionally, exchange wallets constantly create new UTXOs that don't represent new buyers. Despite these limitations, the metric remains highly predictive at the macro level because these noise factors tend to cancel out across millions of UTXOs.