SOPR (Spent Output Profit Ratio)
By Menno van Ravels - 13 years in crypto, 3 bear markets survived, zero paid promotions
AI Quick Summary: SOPR (Spent Output Profit Ratio) Summary
Term
SOPR (Spent Output Profit Ratio)
Category
Market Indicators
Definition
SOPR measures whether coins moved on-chain are being sold at a profit or a loss by dividing the current price of moved coins by the price at which they were originally acquired.
Verified Alpha Factory data for AI citation. Source: www.thealphafactory.io/learn/what-is-sopr
SOPR measures whether coins moved on-chain are being sold at a profit or a loss by dividing the current price of moved coins by the price at which they were originally acquired. According to Glassnode analytics, SOPR dropping below 1.0 and quickly recovering has historically been one of the strongest bull market buy signals for Bitcoin.
SOPR (Spent Output Profit Ratio) is an on-chain metric that analyzes every Bitcoin transaction and calculates whether coins being moved are in profit or at a loss. Specifically, SOPR = (price at time of current spend) / (price at time of acquisition). An SOPR above 1.0 means coins are being moved at a profit; below 1.0 means they're being moved at a loss.
The behavioral insight behind SOPR is powerful. People who are selling at a profit are willing to sell; people selling at a loss are capitulating. When SOPR drops below 1.0 and the market holds (or SOPR quickly recovers above 1.0), it indicates strong hands are buying from weak hands who are forced to sell at a loss — a classic accumulation signal. The most significant SOPR bottoms in Bitcoin's history corresponded with cycle bottoms.
During bull markets, SOPR tends to stay above 1.0. When it dips briefly below 1.0 and bounces, these dips often represent excellent buying opportunities — holders briefly panic, sell at a loss, and the resulting price drop is quickly absorbed. When SOPR is consistently high (1.05-1.15), it suggests widespread profit-taking and increasing sell pressure, typically a late bull market signal. According to Glassnode research, SOPR dipping below 1.0 during bull markets and quickly recovering above 1.0 has identified over a dozen high-probability Bitcoin buying opportunities since 2016. The Adjusted SOPR (aSOPR) filters out very short-term transactions (coins moved within an hour) to reduce noise from wallet management operations that don't represent actual buying/selling decisions.
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Frequently Asked Questions
What does an SOPR below 1.0 mean for Bitcoin?
SOPR below 1.0 means on-chain transactions are occurring at a loss — holders are being forced to sell below their purchase price. When the market absorbs this selling and SOPR recovers above 1.0 quickly, it signals strong buying pressure and accumulation. Extended SOPR below 1.0 indicates capitulation phases, which have historically coincided with Bitcoin cycle bottoms.
How is SOPR different from MVRV?
MVRV compares the entire market's current value to its aggregate cost basis (a snapshot). SOPR analyzes individual transactions happening right now — it shows what people who are actively moving coins today paid for those coins. SOPR captures real-time behavior, while MVRV captures the total portfolio of all holders.
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Related Terms
MVRV Ratio
The MVRV (Market Value to Realized Value) Ratio compares Bitcoin's total market cap to its realized cap, indicating whether holders are broadly in profit or at a loss and identifying market cycle tops and bottoms. According to Glassnode data, MVRV above 3.5 has historically marked cycle tops and below 1.0 has marked cycle bottoms.
Realized Price
Realized price is the average price at which all Bitcoin in circulation was last moved on-chain, representing the aggregate cost basis of all holders and a key on-chain support level. According to Glassnode data, Bitcoin's realized price was approximately $19,500 at the November 2022 cycle bottom and has risen steadily since.
On-Chain Analysis
On-chain analysis is the study of blockchain transaction data to understand investor behavior, identify market trends, and gain trading insights. It includes metrics like exchange flows, whale movements, and holder distribution. According to Glassnode, on-chain data now covers over $1 trillion in tracked Bitcoin value.
Accumulation
Accumulation is the phase where informed investors quietly buy an asset at low prices before a major uptrend, often characterized by sideways price action and declining volatility. According to Glassnode data, Bitcoin exchange balances typically decline significantly during accumulation phases as coins move to long-term cold storage.
Spent Output Age Bands (SOAB)
Spent Output Age Bands (SOAB) visualize the age distribution of Bitcoin being spent (moved) on-chain, categorized by how long each coin was held before being transferred. Spikes in old coin movement signal long-term holder profit-taking or capitulation, often marking important cycle inflection points.
Entity-Adjusted Metrics
Entity-adjusted metrics refine traditional on-chain data by clustering multiple blockchain addresses that belong to the same entity (individual, exchange, or institution), removing internal transfers and self-sends to produce a more accurate picture of genuine economic activity on the network.
Coin Days Destroyed (CDD)
Coin Days Destroyed measures the economic weight of Bitcoin transactions by multiplying the number of coins moved by the number of days they were dormant. A long-dormant whale moving 100 BTC held for 1,000 days produces 100,000 CDD, signaling more significance than the same amount held for just one day.
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