Cryptocurrency Analytics Firm Alphractal has released a market update stating that Bitcoin can enter a long-term integration phase based on used output profit margin (SOPR) trend signals.
SOPR trend signals, which measure the profitability of blockchain transactions, have historically provided insights into market sentiment. According to Alphractal, when the light turns red, many addresses are making important profits. If the metric rises above the upper threshold, it usually serves as a bearish warning against Bitcoin.
“In previous cycles, two consecutive red signals preceded the market weakness and, in some cases, marking the beginning of the bear market,” said Alphractal.
Alfractal highlighted that despite anticipated declines in trading profitability throughout 2024 and 2025, this does not mark the end of the current bull cycle. They pointed to a second half of 2021 when similar SOPR declines occurred, but Bitcoin still surpassed its peak in April 2021, reaching an all-time high of $69,000.
Alphractal suggests that Bitcoin’s most profitable phase may already have passed, particularly following the peak in December 2024 when the SOPR trend signal reached its highest level. Looking forward to it, they are hoping to see a decline in returns from activities on the chain, and could support the market integration phase in the coming months.
*This is not investment advice.
