Bitcoin has regained price levels above $90,000, recovering after remaining under this important threshold for the majority of the past two weeks. During this timeframe, the leading cryptocurrency experienced a drop to a low of $80,600, representing a decline of over 10% from the previously mentioned support level. With the price hovering around 90,000, indications suggest that a recovery is in progress. Yet, a detailed look at on-chain activity reveals that the actual situation is quite different from what many anticipated. Sources emphasizes a significant change in the internal dynamics of the Bitcoin market. This report focuses on data derived from the BTC SOPR Ratio (LTH – STH) metric, which evaluates and contrasts the profit-taking tendencies of Bitcoin’s long-term holders against those of its short-term holders.
Reports shows that the LTH-STH ratio has recently surged to 2.63, marking its peak since August. Interestingly, the recent surge in the SOPR index coincides with Bitcoin’s ascent to approximately $90,000, indicating a notable increase in long-term holder sell-offs despite this slight recovery. This idea is backed by the Long-Term Holder SOPR, which is said to be at 2.58, suggesting that significant participants in Bitcoin’s impactful trend are now leaving the market with considerable gains. The recent sharp shift in the long-term to short-term holder ratio, particularly one that leads to a multi-month high, often indicates a phase of selling pressure that generally foreshadows price corrections. Nonetheless, the present circumstances differ slightly from this standard.
With the LTH SOPR at 2.58 and the STH SOPR hovering around 0.98, it suggests that short-term holders of the flagship cryptocurrency are selling their positions, either at break-even or with some losses incurred. The market imbalance is clear as long-term investors are reaping significant profits and taking advantage of earlier rallies to sell off, while short-term investors struggle to secure definitive gains. Reports shows that if the Bitcoin price decline intensifies, there may be further acceleration contributing to its downward trend.
Historically, the expanding differences between long-term and short-term SOPR have often indicated major shifts in BTC’s market cycle. This behavior, as noted by Arab Chain, suggests that the market is likely entering a typical “cash-for-profit” phase, where major holders are selling off their assets. The firm indicates that, considering the recent surge similar to that in August, the market could be approaching a major price adjustment instead of the small variations that investors are presently anticipating.