Bitcoin SOPR (Spend Out Profit Ratio)

SOPR, STH-SOPR (Short Term Hodler SOPR) and LTH-SOPR (Long Term Hodler SOPR) offer valuable insights into investor behavior and market sentiment.
These indices offer a nuanced view of profit and loss dynamics, shedding light on both short- and long-term investor motivations.

  • SOPR:

    SOPR serves as a key indicator by revealing the BTC spent in profit or loss over the last day.
    The formula compares the selling price of Bitcoin with its acquisition cost, determining whether the transaction generates a profit or loss.
    Values greater than 1 indicate that more investors are selling at a profit.
    Values less than 1 suggest that more investors are selling at a loss.

  • STH-SOPR (Short Term Hodler SOPR):

    STH-SOPR specifically focuses on short-term investors, defined as those who have spent or transferred bitcoin in the last 155 days.
    This index measures short-term investors' BTC gains and provides insight into the earnings dynamics within this specific investor group.
    Values greater than 1 mean that more short-term investors are selling at a profit.
    Values less than 1 indicate that more short-term investors are selling at a loss.

  • LTH-SOPR (Long Term Hodler SOPR):

    LTH-SOPR, on the other hand, targets long-term investors who have held their bitcoin for more than 155 days.
    Like STH-SOPR, LTH-SOPR indicates long-term investors' BTC gains.
    Value greater than 1 implies that more long-term investors are selling at a profit.
    Value less than 1 suggests that more long-term investors are selling at a loss.

High SOPR values across the board can indicate overall bullish sentiment, indicating that a significant portion of the market is selling at a profit.
Fluctuations in STH-SOPR and LTH-SOPR can provide insights into the respective profit-taking behaviors of investors in the short and long term.
Contrasting SOPR with STH-SOPR and LTH-SOPR allows for a more granular understanding of earnings dynamics within specific investor groups.

SOPR, STH-SOPR, and LTH-SOPR collectively offer a multifaceted view of profit and loss dynamics in the Bitcoin market.
By analyzing investor behaviors based on their holding periods, these indices provide analysts and traders with valuable information to navigate the complexities of the cryptocurrency landscape.
As Bitcoin continues to mature, these metrics serve as valuable tools for understanding market sentiment and making informed investment decisions.