Bitcoin SOPR (Spent Output Profit Ratio)

The Bitcoin SOPR (Spent Output Profit Ratio) measures whether the coins moved on-chain each day were sold at a profit or at a loss. SOPR, STH-SOPR (Short Term Holder SOPR) and LTH-SOPR (Long Term Holder 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.

How is SOPR calculated?

Every spent output (UTXO) is valued twice: at the price when it was spent and at the price when it was created. SOPR is the ratio between both values for all the outputs spent that day:

SOPR=Value of spent outputs at spending price/Value of the same outputs at creation price
  • 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: it only takes into account outputs spent less than 155 days after they were created.
    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.

Read the full guide: Bitcoin SOPR Explained, with SOPR in every bull and bear market since 2012 and a test of SOPR = 1 as a buy signal.

Bitcoin SOPR FAQ

What does a SOPR above 1 mean?
On average, the coins spent that day were sold at a higher price than they were bought: the market is realizing profits.

What does a SOPR below 1 mean?
On average, the coins spent that day were sold at a loss. Sustained readings below 1 are typical of bear markets and capitulation phases.

Why is SOPR = 1 important?
In bull markets holders tend to refuse to sell at break-even, so SOPR bounces on 1 and it acts as support. In bear markets holders tend to exit at break-even, so SOPR is rejected at 1 and it acts as resistance. Reclaiming 1 after a long period below it has historically been an early sign of trend change.

What is the difference between SOPR, STH-SOPR and LTH-SOPR?
SOPR includes every spent output. STH-SOPR only includes coins held for less than 155 days, which react quickly to price, and LTH-SOPR only coins held for more than 155 days, whose spending usually marks distribution near cycle tops.

Related charts: STH SOPR · LTH SOPR · MVRV Z-Score · MVRV Ratio · NUPL

API: SOPR · LTH SOPR · STH SOPR

Can SOPR be traded? BG Lab backtests Bitcoin on-chain trading rules built on SOPR, MVRV and other metrics, validated on data they never saw.