Bitcoin Short-Term Holders Are Sitting on Unrealized Profits as the Price Rallies

Bitcoin's recent rally toward $110,000 has focused attention on short-term investor behavior. On-chain indicators suggest unrealized profits are rising among holders

Bitcoin's recent rally toward $110,000 has focused attention on short-term investor behavior. On-chain indicators suggest unrealized profits are rising among holders who acquired BTC in the past one to three months.

According to blockchain analytics, this group currently holds an average unrealized gain of 27%, raising the possibility of increased selling pressure if a previous target is reached.

Data from CryptoQuant, as analyst Axel Adler Jr. reported, highlights that when this short-term holder Net Unrealized Profit/Loss (NUPL) metric surpasses 40%, profit-taking typically begins, often leading to price pullbacks.

"The current unrealized profit indicator for Short-Term Holders (1-3 months) is 27%. Over the past 4 years, when this metric went above 40%, this cohort began selling coins – this created strong price pressure.1. Current NUPL (Short-Term Holders, 1–3 m): 27%2.… pic.twitter.com/izQAWOhhId"

With the current growth rate at approximately 0.818% points per day, this level could be crossed in about 16 days. If that pace continues, the NUPL may reach 40% by June 11, 2025, projecting a possible Bitcoin price near $162,000.

Profit-Taking Patterns Identified in Past Cycles

Historical market tops for Bitcoin have repeatedly aligned with elevated short-term holder profits.

In November 2021, when this cohort’s NUPL margin reached 47%, Bitcoin experienced a local high followed by a correction. Similar outcomes were recorded in March 2022 (44%), July 2023 (47%), and most notably in March 2024, when the metric peaked at 66%.

After these events, the prices went down, and so did the NUPL. If the NUPL is negative, it shows that early investors are now losing money due to prices falling below their original purchase price. These changes from high profits to losses have helped shape the Bitcoin market’s movement.

From late May 2025, the NUPL of 27% points to current earnings in the profit zone, yet below the previous levels that caused broad disturbances. Bitcoin's position supports its growth, but continuous monitoring is necessary as the indicator approaches significant values.

On-Chain Activity Signals Divergence

Even though prices are high, Bitcoin's network is less active than it was earlier. Transaction data reveals less activity on the network as prices went above $90,000. Starting through mid-2023 and into early 2024, the number of daily active addresses rose above 1 million. Consequently, since mid-2024, the number has decreased between 700,000 and 900,000.

Some analysts view this divergence between price and user engagement as indicative of reduced retail participation. The growth in unrealized profits alongside falling address activity may signal an increasing reliance on off-chain markets, such as institutional investment platforms or derivative instruments, rather than organic user adoption.

If current trends continue, Bitcoin may test its short-term holder profit threshold by mid-June. Market participants are watching whether NUPL crosses the 40% mark, which could limit the beginning of another sell phase.