Recent on-chain data indicates that short-term Bitcoin holders have begun to sell their holdings, often at a loss. This trend could have implications for the future price trajectory of the cryptocurrency.
The Spent Output Profit Ratio (SOPR) for short-term holders has recently dipped below the critical level of 1. This metric serves to analyze whether Bitcoin holders are liquidating their assets for a profit or a loss. By evaluating transaction histories, the SOPR calculates the ratio of profits to losses realized by these holders. A value above 1 indicates that most short-term holders are selling at a profit, while a value below 1 signifies that losses are prevalent.
Specifically focusing on short-term holders — those who acquired their coins in the last 155 days — current numbers reveal that profit-taking has transitioned to loss-taking amid recent market fluctuations. Historically, short-term holders are considered more reactive to market changes, typically selling at the first signs of volatility, whether in the form of significant price increases or declines.
In recent months, the SOPR had surged above 1, signaling that short-term holders were capitalizing on profits as Bitcoin prices rose to new highs. However, following the latest downturn, the 7-day simple moving average for this group has decreased to 0.99. This indicates that the number of holders realizing losses now marginally surpasses those realizing profits.
Historically, episodes of significant loss-taking by short-term holders have often coincided with Bitcoin price peaks, suggesting a potential signal of further downward movement before any potential recovery. CoinMarketCap data shows that Bitcoin ’s price has experienced another significant decline over the past several hours, bringing it down to around $89,600, erasing earlier gains and adding to concerns about the immediate future of its market performance.
