🚨 Bitcoin Traders: This Key Indicator Warns of a Potential 20% BTC Drop!

Bitcoin's bull run hits a warning sign—one metric flashes red as traders brace for volatility.

The Signal No One Wants to See

A historically reliable technical indicator suggests BTC could shed 20% of its value. The same pattern preceded past corrections—now it’s back, and traders are sweating.

Why This Time Feels Different

Leverage is sky-high, whales are quietly offloading, and retail FOMO just peaked. Sound familiar? *Cough* 2021 *cough*.

The Silver Lining (Because Crypto)

Dips breed opportunities. If history rhymes, this could be the fire sale before the next leg up. Or, you know, another ‘buy high, panic low’ moment for the degens.

Wall Street’s Watching—And Laughing

Meanwhile, traditional finance bros sip lattes, muttering ‘told you so’ as they short your hopium with ETFs. Stay sharp out there.

Key takeaways

Bitcoin’s SOPR neared 1.02, a level that previously triggered 10–20% pullbacks. Despite rising leverage, steady exchange outflows, and moderate Funding Rates suggest cautious Optimism amid potential volatility.

Bitcoin’s [BTC] 90-day SOPR has climbed to 1.018, at press time, nearing the historically critical 1.02 level that triggered sharp pullbacks in March 2024 and February 2025.

Each time the SOPR crossed into the 1.02–1.03 zone, Bitcoin experienced 10–20% drops within two weeks. 

This pattern reflects a zone of intense profit-taking pressure. At the time of writing, bitcoin was trading around $66,000, and if SOPR continues to rise, the market may face similar sell-side volatility. 

Therefore, traders are watching closely for any signs of a potential overheated top. The next MOVE could test whether bulls have the strength to absorb renewed selling momentum.

Source: CryptoQuant

Are Bitcoin’s utility and adoption signals weakening?

Both the NVT and NVM ratios have seen significant declines, with NVT down 11.21% and NVM down 16.21%, at press time. These metrics gauge valuation against transactional activity and network adoption, respectively. 

A drop in both ratios often implies that price is rising faster than underlying utility or user growth. Therefore, despite bullish narratives around ETFs and macro tailwinds, the drop may suggest waning transactional demand. 

If this divergence persists, it could undermine the sustainability of current price levels. However, a reversal in these ratios could also signal a renewed phase of organic network strength.

Source: CryptoQuant

Is rising leverage building a powder keg?

Bitcoin’s Open Interest-Weighted Funding Rate has turned increasingly positive since early July, suggesting growing bullish bias among derivatives traders.

As long positions accumulate, the market becomes more exposed to sudden liquidation cascades if the price drops. 

Historically, such periods of aggressive long build-up have ended with volatile shakeouts. However, Funding Rates have remained relatively stable, without extreme spikes, which suggests measured optimism rather than outright euphoria. 

Still, if the SOPR crosses 1.02 and funding surges simultaneously, a violent unwinding could follow. Therefore, traders may look to hedge against overleveraged conditions brewing under the surface.

Source: Coinglass

Why are coins still flowing out despite SOPR nearing danger levels?

Exchange Netflows remained negative, as of writing, with a 2.35% drop reflecting consistent outflows totaling over 31K BTC. This trend highlights that investors continue withdrawing coins, likely for self-custody or long-term holding. 

Typically, rising SOPR WOULD signal increased deposits for profit-taking, but that is not yet evident here. Therefore, the outflows challenge the bearish SOPR implications and suggest deeper accumulation in play. 

However, should SOPR breach 1.02 and exchange inflows suddenly rise, it could confirm a shift to distribution. For now, the bias remains toward reduced sell pressure from large holders.

Source: CryptoQuant

Can Bitcoin defy the SOPR signal this time?

Bitcoin is nearing the SOPR threshold of 1.02, which has historically triggered heavy profit-taking and sharp corrections. However, steady exchange outflows and moderate funding rates suggest the current setup may differ. 

If bullish momentum holds and leverage stays controlled, the market could avoid another sell-off.

Still, traders must remain cautious, as any surge in SOPR or funding could flip sentiment quickly and ignite volatility in the short term.