Bitcoin’s 97.2% Supply in Profit and the Implications for the 2025 Bull Run

The Bitcoin market in late 2025 is at a pivotal juncture, with 97.2% of its supply in profit—a metric that has exceeded historical norms for over 273 days [1]. This figure, the second-highest since the 2017 bull cycle, underscores a maturing market structure driven by institutional confidence and strategic macro positioning. However, the interplay of on-chain metrics reveals a nuanced picture: while the bull trend remains intact, late-cycle signals suggest the market is navigating a fragile equilibrium between consolidation and exhaustion.

On-Chain Sentiment: A Tale of Two Dynamics

The Spent Output Profit Ratio (SOPR) at 1.016 and the Market Value to Realized Value (MVRV) ratio at 2.16 highlight a market in transition [1]. SOPR, which measures the average profit or loss of spent outputs, indicates that short-term holders (STHs) are selling at or slightly above breakeven, reflecting moderate profit-taking without panic. Meanwhile, the MVRV ratio’s compression to the 1.0 neutral zone in August 2025 suggests a rebalancing phase, historically associated with pre-bull breakout consolidation [4].

The Percent Supply in Profit (PSiP) remains above +1σ (~91–92%), a threshold not breached even during the July 2025 correction to $112,000 [1]. This resilience reinforces the idea that most holders are still in profit and not distributing their positions. However, a 11% drop in the LTH/STH supply ratio over a single month—driven by increased STH activity—signals rising volatility as speculative profit-taking intensifies [1].

Cyclical Turning Points: Echoes of 2017 and Beyond

Historically, PSiP levels above 90% have coincided with major bull market peaks, such as the 2017 cycle, where long-term holders (LTHs) realized 3.27 million BTC in profits [3]. The current cycle mirrors this pattern, with LTHs maintaining a 2.5 MVRV Age Breakdown Composite index—far above the historical average of 1.0 [1]. This suggests that long-term holders have locked in gains for extended periods, a bullish sign of structural strength.

Yet, caution is warranted. The Bitcoin Bull Score has dropped to 20, a level historically linked to bearish conditions [2], while SOPR spikes above 4 in late 2025 and elevated Fear & Greed index readings signal potential exhaustion [3]. These red flags align with historical precedents where high profit-taking levels preceded market tops [4].

Institutional Accumulation and Macro Resilience

Despite these late-cycle signals, the market has demonstrated remarkable resilience. For instance, a $9.6 billion OTC Bitcoin sale in July 2025 was absorbed without a major correction, highlighting robust institutional and retail demand [1]. ETF inflows and macroeconomic factors, such as regulatory clarity and expanding institutional participation, have deepened liquidity, enabling the market to weather large sell orders [1].

The MVRV compression to 1.0 in August 2025 further supports this narrative. Historically, this neutral threshold has preceded bullish momentum as speculative gains unwind and utility-driven demand takes over [1]. The current consolidation phase, supported by stable support levels at $110K–$112K, suggests the market is preparing for a potential breakout rather than entering a bearish phase [4].

Conclusion: A Delicate Balance

Bitcoin’s 97.2% supply in profit reflects a mature bull market underpinned by institutional confidence and long-term accumulation. However, the divergence between short-term speculative activity and long-term structural strength signals a market at a cyclical inflection point. While on-chain metrics like SOPR and MVRV suggest consolidation, caution is warranted as late-cycle indicators—such as the Bitcoin Bull Score and elevated Fear & Greed readings—hint at potential exhaustion.

For investors, the key lies in balancing optimism with prudence. The market’s ability to absorb large sell orders and maintain PSiP above 90% indicates a resilient structure, but the risk of distribution pressures remains. As the 2025 bull run enters its final phase, strategic positioning and macroeconomic tailwinds will likely determine whether this cycle mirrors the euphoric peaks of 2017 or carves a new path.

**Source:[1] Bitcoin's 2025 Cycle: Second-Most Profitable Yet—Is This ...,
https://www.ainvest.com/news/bitcoin-2025-cycle-profitable-time-exit-expand-2508/[2] Bitcoin's Bull Score Flashes Red: What On-Chain Data Means for BTC's Future
https://cryptopotato.com/bitcoins-bull-score-flashes-red-what-on-chain-data-means-for-btcs-future/[3] Bitcoin (BTC) Long-Term Holders Realize 3.27M BTC in Profits This Cycle, Second Only to 2017 — Late-Bull Signal Traders Should Watch (2025) | Flash News Detail | Blockchain.News,
https://blockchain.news/flashnews/bitcoin-btc-long-term-holders-realize-3-27m-btc-in-profits-this-cycle-second-only-to-2017-late-bull-signal-traders-should-watch-2025[4] Bitcoin's MVRV Compression and Market Consolidation
https://www.ainvest.com/news/bitcoin-mvrv-compression-market-consolidation-strategic-entry-points-bullish-cycle-pause-2508/