Bitcoin Long-Term Holders Realize March 2020-Like Losses As BTC Crashes

Keshav Verma

1 year ago

3 mins read

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On-chain data shows the Bitcoin long-term holder SOPR has dropped to March 2020 levels as the price of the crypto crashes below $24k.

Bitcoin Long-Term Holder SOPR Plunges Deeper Below One

As pointed out by an analyst in a CryptoQuant post, BTC long-term holders are now realizing a similar level of loss as during March 2020.

The “spent output profit ratio” (or SOPR in brief) is an indicator that tells us whether Bitcoin investors are selling at a profit or at a loss right now.

The metric works by looking at the on-chain history of each coin being sold to see what price it was previously moved at.

If this last price was less than the current value of the crypto, then that particular coin has now been sold at a profit.

On the other hand, the previous selling value being more than the latest price would imply the coin realized a loss.

When the value of SOPR is greater than one, it means the overall BTC market is selling at a profit at the moment. Values less than one, on the contrary, imply that investors as a whole are realizing losses right now.

“Long-term holders” (LTHs) are those Bitcoin investors who hold their coins for at least 155 days without selling them.

Here is a chart that shows the trend in the BTC SOPR specifically for these LTHs:

The value of the 20-day MA LTH SOPR looks to have plunged down recently | Source: CryptoQuant

As you can see in the above graph, the Bitcoin long-term holder SOPR dropped below one in value just a while ago, showing that LTHs have been selling at a loss recently.

The degree of LTH loss realization right now is the same as it was back in March 2020, following the crash due to COVID-19. The crypto also hit a bottom around then.

The long-term holders now suffering from similar pain as back then may suggest that the market may soon see a bottom this time as well.

BTC Price

At the time of writing, Bitcoin’s price floats around $23.5k, down 24% in the last seven days. Over the past month, the crypto has lost 19% in value.

The below chart shows the trend in the price of the coin over the last five days.

Looks like the value of the crypto has crashed down over the last couple of days | Source: BTCUSD on TradingView

Today, Bitcoin plummeted below the $24k mark for the first time since December 2020, over 18 months ago. Currently, it’s unclear whether the crash has passed or if the coin will decline further still.

Featured image from Unsplash.com, charts from TradingView.com, CryptoQaunt.com

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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