Ethereum NUPL Plunges to -0.35 on Binance, Historic Capitulation Level

Ethereum's on-chain metric has hit a level that historically precedes major market bottoms. According to CryptoQuant analyst Julio Moreno, Ethereum's Net Unrealized Profit/Loss (NUPL) on Binance has fallen to -0.35, a level observed during key capitulation events in 2019, 2020, and the 2022 bear market.

The NUPL measures the aggregate unrealized profit or loss of all held assets, calculated as the difference between the current market value and the price at which the coins were last moved, divided by the market cap. A negative NUPL indicates that holders are sitting on losses. Moreno's reading specifically applies to ETH held on Binance.

This has historically marked periods of intense fear and capitulation, often aligning with cyclical bottoms. In late 2019, March 2020, and the 2022 bear market, similar NUPL levels were accompanied by a flushing out of weaker hands, substantially reducing selling pressure and setting the stage for subsequent recoveries.

While this metric is not a precise timing tool, it provides valuable insight into market sentiment and potential supply squeeze. When NUPL reaches such extreme negative territory, it suggests that many investors are unwilling to sell at a loss, leading to a decrease in available supply on exchanges.