Traditional US investors have reduced their exposure to Bitcoin and sold through fund managers after the asset failed to deliver meaningful gains in recent weeks.
These exits have largely taken place via US Spot Bitcoin exchange-traded funds (ETFs), which recorded their largest net outflows in a single week of $1.33 billion – the highest level since February 2025.
Such large outflows typically tilt market sentiment toward a bearish outlook. However, Bitcoin has remained relatively resilient, supported by short-term holding activity.
This raises an important question: can STH sustain this pattern as traditional investors continue to offload their positions?
Short term holders almost profitable
Signs of a gradual shift in sentiment among Bitcoin [BTC] Short-term holdings emerged, mainly due to changes in coin age classes, indicating a transition to longer-term holding behavior.
This shift coincided with an improvement in profitability at STH. The Short-Term Holder Spent Output Profit Ratio (STH SOPR), which measures whether this group is selling at a profit or a loss, indicated that profitability was within reach.
The STH SOPR uses level 1 as a neutral benchmark. Values above 1 indicate profit taking, while values below indicate losses. The distance to this level reflects the depth of the gain or loss.
Source: CryptoQuant
At the time of writing, Bitcoin’s STH SOPR stood at 0.99 – just below the profitability threshold. This near-neutral reading suggests a gradual adjustment, driven by increased accumulation of short-term bonds.
Historically, conviction tends to grow stronger when STH becomes profitable. Holders are less likely to sell as improving conditions often indicate the potential for further price recovery.
The market is positioned for a recovery
An analysis of the ratio between the Long-Term Holder (LTH) SOPR and the Short-Term Holder SOPR indicated that market conditions continue to favor further Bitcoin appreciation.
The ratio was around 1.3 at the time of writing, which puts it at the lower end of the historical range. When this ratio rises to extreme heights, it is often a signal that Bitcoin has reached a local top. The market currently remains well below this level.
Source: CryptoQuant
This suggests that the recent price drop does not mark a cycle top and that buyers can still intervene to accumulate at current levels.
If the STH SOPR definitively moves above the neutral level of 1, this outlook would be further strengthened. As it rises, the LTH-to-STH SOPR ratio would also rise – a dynamic that has historically supported Bitcoin’s price strength.
Long-term holders are still important
While short-term bonds play a crucial role in stabilizing price action and supporting a potential recovery, long-term bonds remain equally important.
If the current situation is to persist, LTH must largely refrain from sales, because significant distribution from this group could weigh heavily on the already limited demand.
Source: CryptoQuant
The Binary Coin Days Destroyed (CDD) metric, which tracks whether long-term holders spend or hold their coins, showed minimal selling activity. This suggests that LTH remains relatively inactive and confident.
As long as Binary CDD remains at 0, market conditions remain net positive, supporting the growing constructive sentiment in the Bitcoin market.
Final thoughts
- Traditional investors are exiting the Bitcoin market with weekly outflows of $1.33 billion as short-term holders move closer to profitability.
- Market conditions indicate a possible rebound, with room for upside momentum.