Bitcoin Plunges to 4-Week Low While Holder Profits Hit Peak Levels

Bitcoin's rollercoaster ride continues as the digital asset hits its lowest point in four weeks—just as long-term holders cash in record profits.

The Profit-Taking Paradox

Glassnode data reveals a curious divergence: while prices slide to monthly lows, wallet metrics show investors locking in gains at unprecedented rates. This profit-taking frenzy suggests seasoned holders see current levels as prime exit opportunities.

Market Mechanics in Motion

The simultaneous drop in price and surge in profit-taking creates textbook volatility conditions. Long-term believers strategically harvest gains while short-term traders panic-sell—a classic bull market consolidation pattern that often precedes major moves.

Institutional vs Retail Dynamics

Whale wallets show calculated profit-taking rather than mass exodus, indicating sophisticated positioning rather than fear-driven dumping. Meanwhile, retail investors typically misinterpret these signals as bearish—proving once again that Wall Street's 'smart money' plays chess while main street plays checkers.

This profit-taking flushout actually sets the stage for healthier long-term growth. Because nothing builds solid foundations like shaking out weak hands—except maybe another round of central bank money printing.

Profit-taking hits cycle peak

According to Glassnode, the ratio of realized profit to loss has spiked above 90% for coins moved three times this cycle.

Historically, such peaks have marked major local tops for bitcoin, prompting expectations of a market cooling phase.

The analytics firm commented that “probabilities favor a cooling phase ahead.”

Signs of stress among recent holders

10x Research head Markus Thielen noted that the Spent Output Profit Ratio (SOPR) has dipped to 1.01, indicating some holders are now selling at a loss—a signal of increased market stress.

In the past, SOPR levels below 1 have indicated seller exhaustion in bull markets, while rejections at or above 1 in bear markets can signal further downside.

The Short-Term Holder Net Unrealized Profit/Loss (NUPL) is also approaching zero, raising the risk of forced liquidations among newer buyers.

Outlook remains uncertain

Glassnode analysts warned that unless institutional and holder demand rebounds:

“The risk of deeper cooling remains high, highlighting a macro structure that increasingly resembles exhaustion.”

Thielen stated that 10x Research remains neutral “unless Bitcoin can reclaim $115,000.”

Meanwhile, MicroStrategy chair Michael Saylor remained optimistic, expecting a rebound for bitcoin after macroeconomic headwinds clear.

At the time of writing, bitcoin was priced at $109,645, down 6.5% over the past week.