Analyst: Short-term holders' SOPR fell below 1, average profits have been wiped out

CryptoQuant analyst Darkfost stated that the Spent Output Profit Ratio (SOPR) of short-term Bitcoin holders has dropped to 0.98, remaining in negative territory since October 30, indicating that this group has begun to realize losses when selling Bitcoin.

This metric measures the profit and loss realized when UTXOs are spent. Each UTXO has its own cost basis; when Bitcoin is moved, old UTXOs are destroyed, and new UTXOs are generated at new realization prices. SOPR calculates the difference between the two. This round only counts short-term holders, whose monthly average once reached 1.013 but has now fallen back to a neutral level of 1, erasing average profits.

Darkfost noted that recent data suggests the market is leaning towards a capitulation phase. He believes that in a long-term bull market, a negative SOPR often corresponds to buying opportunities, but the monthly average has yet to reflect this, and capitulation may continue for several more days before reaching extremes.