Woo’s latest article on X talks about the Bitcoin Spent Output Profit Ratio (SOPR), an important on-chain metric that shows whether Bitcoin holders are making funds or losing funds when they sell their coins.
When the SOPR goes above 1, it means that buyers are selling their BTC holdings for a profit on average. On the other hand, a negative SOPR means that most people in the market are selling at a loss. A SOPR of 1 means that gains and losses are equal, which means that investors will break even.
Bitcoin SOPR Post-ATH Trends
When BTC hit a new all-time high (ATH), the SOPR went up a lot. This showed that investors were taking significant gains, similar to what happened at the start of the 2021 bull run.
After hitting its highest point, the SOPR has been going through a cooling-off period while Bitcoin is in its consolidation phase after the all-time high. Woo shows this trend in the chart given, pointing out that the measure is getting closer to being neutral.
This change could mean that investors are less eager to make funds, which would be favorable to the coin market. Notably, funds coming into BTC have started to rise again, following the same trend seen during the post-spot exchange-traded funds (ETFs) approval crash earlier this year. This caused a rally that led to Bitcoin’s current all-time high.
Even though a recent drop below $66,000 caused some worry, Bitcoin quickly recovered and soared back above $67,000 today, showing that its comeback momentum is powerful.
