The STH-SOPR Indicates Less Favorable Conditions for Short-Term Bitcoin Holders
If you’re a short-term holder of Bitcoin, you may want to pay attention to the Short-Term Holder Spent Output Profit Ratio (STH-SOPR). Currently, the STH-SOPR has decreased from 1 to 0.9809, signaling less favorable conditions for short-term Bitcoin holders due to recent price declines.
The STH-SOPR measures the profitability of Bitcoin trades involving coins held for less than 155 days. When the STH-SOPR declines during a price correction, it suggests that many short-term holders are likely to sell their Bitcoin. This can contribute to an overall drop in prices and potentially lead to a self-reinforcing cycle of declining prices, according to on-chain analysis platform CryptoQuant.
Slow Progress on ETFs
If you’re an investor in Bitcoin, you may be feeling less enthusiastic due to the perceived lack of progress on spot Bitcoin exchange-traded fund (ETF) applications. The Securities and Exchange Commission (SEC) recently decided to delay its decision on seven ETF applications, pushing the new decision deadline to mid-October.
This delay comes despite a recent court ruling involving digital asset manager Grayscale, which experts believe will make it difficult for the SEC to deny any of the applications. The win for Grayscale means that the SEC cannot legally stop them from converting their Bitcoin Trust to a spot ETF, something they have wanted to do for a long time.
Hot Take
While the STH-SOPR indicates potential selling pressure from short-term Bitcoin holders, the slow progress on ETFs adds to the overall uncertainty in the market. As a result, it’s important for Bitcoin investors to stay informed and closely monitor these developments to make informed decisions about their investments.
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