Bitcoin's On-Chain Data Signal Bear Phase Ahead - U.Today

• Bitcoin’s aSOPR retests 0.92
• Is Bitcoin’s recovery still possible? The crypto market has continued to show mixed signals as the market has remained extremely weak for most of the year

Amid poor market conditions, Bitcoin’s on-chain metrics are beginning to flash warning signals as its crucial indicator suggests the asset is approaching a bear season.

On Monday, Feb. 16, crypto analytics platform CryptoQuant shared on-chain data revealing that a key profitability metric has fallen back to historic levels, which marked the beginning of major bear seasons.

HOT Stories

Morning Crypto Report: Europe Leads Ripple USD Activity on XRP Ledger, Dormant Ethereum Wallet With 6,335x Profit Fails 1 ETH Deposit, Solana Records $31 Million Weekly ETF Inflows Amid ‘Buoyant’ Sentiment

50 Million XRPs Sold in Less Than 24 Hours

Bitcoin’s aSOPR retests 0.92

Per the data, Bitcoin’s Adjusted Spent Output Profit Ratio (aSOPR) has declined massively to the 0.92-0.94 range. Notably, this level has previously marked major corrective phases in past market cycles.

It is important to note that aSOPR metric is used to measure whether coins moved on the Bitcoin network are being sold at a profit or loss

This is also evident in the steady institutional withdrawals seen among Bitcoin ETFs, as the majority of the funds have continued to register steady outflows.

Thus, a reading below 1.0, as currently seen in the provided data, suggests that investors are, on average, spending coins at a loss

Nonetheless, the analyst further emphasized that similar levels were reached in 2019 and 2023, and they both coincided with periods of heavy selling pressure and market capitulation, when participants exited positions amid weakening sentiment.

Is Bitcoin’s recovery still possible?

The analyst further provided charts revealing that the current crypto market structure is similar to those earlier transition phases

Multiple cycle lows on prior markets formed near the 0.92-0.93 zone, suggesting that the metric is once again approaching major historically bear territory

Unlike midcycle pullbacks, where aSOPR typically rebounds above 1.0 quickly, the present move reflects sustained weakness and continued loss realization.

While the broad market momentum remains weak, market analysts predict that Bitcoin may not recover from its downturn if aSOPR fails to reclaim the 1.0 level in the near term.

As such, the probability increases that the market is shifting from a temporary correction period into a broader bearish phase