Bitcoin (BTC) Investors Have Been Realizing an Hourly Profit 17% Above the Baseline

A report from the on-chain analytics firm Glassnode has revealed how Bitcoin investors have recently been realizing an hourly profit 17% above the baseline.

Bitcoin (BTC) investors have recently been realizing an hourly profit 17% above the baseline, on-chain analytics firm Glassnode revealed in its latest weekly report.

This profit-taking activity has seen the Bitcoin Realized Profit soar to $139 million per hour, nearly reaching the levels last seen during the peak of the 2021 bull rally.

At this rate, the investors are realizing profit at a faster pace than what the market can easily absorb, rendering it an interesting data point to keep an eye on.

As seen in the above graph, the Bitcoin Realized Profit has shot up rapidly in recent times. This increase in the indicator has arrived as BTC has been recovering rapidly from the lows of June 15, rendering it appear that the investors have been keen to cash in on the recovery.

The indicator has now reached a peak rate of $139 million per hour, which is about 17% higher than the baseline value of $120 million per hour. While this level isn’t too high when compared to the profit-taking sprees from the last bull rally (highlighted in green), it’s still notable, especially when considering how much lower it has been during the last couple of months.

“If the market can absorb this selling pressure without breaking down, it paints a more constructive picture on the road ahead,” notes Glassnode. “Conversely, failure to hold these levels, under heavy profit realization, could mark this move as another dead cat bounce, which would be consistent with prior relief rallies that faded under similar conditions.”

This profit-taking activity seems to be coming mostly from the short-term holder cohort, according to data from the analytics firm.

The short-term holders (STHs) are the BTC investors who purchased their coins within the past 155 days. In contrast, the long-term holders (LTHs) are those who bought their coins more than 155 days ago.

Now, take a look at the chart for the Spent Output Profit Ratio (SOPR):

The SOPR is an indicator that measures the ratio between the realized profit and the realized loss. When the SOPR is above the 1.0 mark, it suggests that profit-taking is outweighing loss-taking, and vice versa.

In the above graph, the STH SOPR is shown in blue, while the LTH SOPR is shown in gray. As is clear from the chart, the STH SOPR has seen a sustained move above the 1.0 mark recently.

This move into profit-taking territory comes after several months of STH SOPR remaining below the 1.0 mark, which suggests that these investors were collectively reporting a loss on their coins.

However, the LTH SOPR has remained above the 1.0 mark throughout most of 2024 so far, which is a testament to the fact that these investors have largely remained in profit.